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Leaked Government documents suggest two of UK’s refineries could close after no-deal Brexit

20 August 2019

A leaked dossier on the possible ramifications of a no-deal Brexit on the UK economy published by The Sunday Times on August 18 includes the possibility that two of the country’s six remaining refineries could close.

Valero Pembroke refinery - Image: Valero
Valero Pembroke refinery - Image: Valero

The leaked documents, part of the Government’s ‘Operation Yellowhammer’ scenario planning, warn that Government plans to slash import tariffs to 0% under a no-deal may "inadvertently" lead to the closure of two British oil refineries which would bear "significant financial losses".

While fuel imports would not be subject to tariffs, exports would be, removing the level playing field.

The Operation Yellowhammer documents state: "This leads to big financial losses and the closure of two refineries (which are converted to import terminals) with about 2,000 direct job losses."

Traffic disruption caused by border delays could also affect fuel distribution and disrupt supply to London and the south-east. Other possible outcomes would be a three-month meltdown at UK ports, a hard Irish border and shortages of food and medicine if the UK leaves without a deal.

In a reaction to the leaks, Valero Pembroke Refinery General Manager Ed Tomp said: “Over the last 12 months we have made preparations to ensure that Valero Pembroke Refinery continues to operate safely and reliably regardless of whether the UK leaves the European Union on October 31.

“However we are concerned that 0% import tariffs on petrol could create an unfair advantage for importers, resulting in a negative impact on all UK refineries.

“As such we have been working with UKPIA (United Kingdom Petroleum Industry Association) to ensure our concerns – and the potential impact of zero tariffs - are clearly communicated to the UK Government.”

Preseli Pembrokeshire MP Stephen Crabb said Valero Pembroke Refinery would be hit hard because it could jeopardise Valero’s important trade with Ireland, according to the Western Telegraph.

Michael Gove - the Cabinet minister responsible for no-deal planning - insisted Yellowhammer represented a worst-case scenario and that the leaked documents were out of date.

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