Management buyout mooted for Murco’s Milford Haven refinery
20 May 2014
Murco Managing Director Tom McKinlay told employees on May 16 he was taking a leave of absence to pursue a possible management buyout of the group’s refinery at Milford Haven in Pembrokeshire, according to a Reuters report quoting an anonymous source.
Murco's Milford Haven refinery
Murco, the UK subsidiary of US-based Murphy Oil, has been engaged for the last four years in talks with several parties over the sale of its 135,000 barrels-per-day refinery and related assets, the last large-scale downstream facility in its portfolio.
Brian Kelly, currently head of Murphy's business development in West Africa, the Middle East and Britain, will replace him and lead Murco's negotiations with potential buyers, the source said.
McKinlay is in the process of trying to raise funding for the buyout, but the Reuters source said other potential bidders included private equity fund Greybull Capital and Swiss industrial group Klesch.
The Milford Haven plant in Wales stopped purchasing crude oil last month and is in the process of reducing its operations as stockpiles are expected to run out by next week, a second source said.
After a plant is completely shut, restarting it can be prohibitively expensive. Continuity of production over the next few weeks and months must be maintained to ensure the plant has any long-term future.