Major British Oil Refinery Faces Imminent Shutdown as Supply Crisis Looms

A critical oil refinery responsible for 10% of Britain’s fuel supply stands on the brink of closure, threatening significant disruption to national fuel distribution. The Lindsey Oil Refinery in Lincolnshire, which entered insolvency proceedings on Monday, has ceased both crude oil deliveries and refined fuel dispatches.

The facility, previously operated by the Prax Group, supplies vital jet fuel to Heathrow Airport alongside petrol and diesel to hundreds of filling stations across the country. Energy Secretary Ed Miliband is urgently working to secure the site’s future as the situation grows increasingly dire.

The crisis stems from an unresolved dispute between the Insolvency Service and commodities giant Glencore, which maintains ownership of the oil and refined products until payment settlement. The refinery has temporarily sustained operations by utilising on-site stockpiles, but storage capacity is expected to reach its limit by week’s end.

The collapse of parent company Prax, previously led by Sanjeev Kumar Soosaipillai and his wife Arani Soosaipillai, has raised serious questions about corporate governance. The couple extracted a £3.65 million dividend last year despite the company recording nearly £30 million in losses.

The workforce of 400 skilled employees faces an uncertain future, with industry sources reporting growing concerns about potential staff departures. The situation is particularly troubling given the recent closure of Scotland’s Grangemouth refinery, which has already reduced Britain’s refining capacity.

Government officials maintain that the UK remains well-supplied with fuel, citing the proximity of other major refineries. However, the potential shutdown of Lindsey Oil Refinery would leave Britain with just four major refineries, raising significant questions about the nation’s long-term energy security and fuel supply resilience.