Glencore Left Uninformed as Prax Lindsey Refinery Faces Administration Crisis

Major commodity trading group Glencore was kept in the dark about critical financial difficulties at the Prax Lindsey oil refinery until mere days before its collapse into administration, despite government awareness of the issues spanning several months.

The UK’s smallest refinery now teeters on the brink of closure as restructuring specialists frantically work to secure vital supply contracts. The government’s issuance of a winding-up petition has placed the facility under the official receiver’s management, with calls for a thorough investigation into its directors’ conduct.

The refinery, capable of processing 113,000 barrels daily, was acquired by Winston and Arani Soosaipillai through their Prax oil group in 2021 for £167 million. The pair had methodically built their oil empire over two decades, establishing a substantial presence across the supply chain with revenues exceeding £10 billion.

Michael Shanks, junior energy minister, addressed Parliament stating, “The government learnt of ongoing commercial difficulties in late April. Our repeated requests for clarity on the financial gap went unanswered, hampering potential government intervention.”

The crisis extends beyond the refinery, with State Oil, the parent company, also entering administration under Teneo’s guidance. The broader group’s assets, including Axis logistics operations and North Sea production facilities, remain operational, with no immediate redundancies planned.

This development follows the recent closure of Scotland’s Grangemouth refinery, where 430 jobs were lost. The successive refinery crises raise serious questions about the sustainability of Britain’s domestic fuel processing capacity and its implications for national energy security.