Stanlow, 21st May 2021: Essar Oil (UK) Limited (“EOUK”), which owns and operates the Stanlow Refinery, today announced that it has closed new financial arrangements of over US$850 million. This has allowed EOUK to replace its former credit facility as well as access additional capital, thereby strengthening its financial position. The funding is made up of liquidity from a diversified range of sources, including bilateral arrangements with many of its key customers on enhanced payment terms and other long-term financings, linked primarily to crude supply.
With these financial arrangements now in place, EOUK has more low-cost liquidity to meet its upcoming requirements, and can continue to focus its energies on its transition to become a “Low Carbon Energy Provider” of the future. EOUK is already working on delivering two blue hydrogen production hubs at Stanlow, which will attract £750 million in total investment. Follow-on capacity growth is planned to work towards the Government’s new target of 5GW of low carbon hydrogen for power, transport, industry and homes. Stanlow is committed to reaching 80% of the Government-set targets. In addition, EOUK remains committed to delivering the necessary operational cost reductions at the refinery over the course of the coming year in order to help secure its long-term future and to ensure it remains competitive in its traditional refining business.
EOUK has also recently completed a review and update of its corporate governance and its Board has adopted the recommendations arising out of that review process, which included independent input from Ashurst LLP. As a result of that process, the Board has committed to appointing two independent Non-executive Directors to the Board.
Commenting on the recent developments, Chairman Prashant Ruia said: “Securing this financing demonstrates the confidence all our stakeholders have in our long-term vision for Stanlow.
“We believe this confidence will be further bolstered by the updates we have made to our corporate governance, which includes a commitment to appoint two new independent Non-executive Directors to our Board. These appointments will further enhance our overall governance and risk assessment processes, as well as providing insights and strategic inputs to the business as it continues its transition to low carbon operations.
“With a strong economic recovery driven by the UK Government’s roadmap out of the pandemic, I feel that our business has moved into a positive and progressive phase for the benefit of all of our stakeholders and employees. We look forward to furthering our investments in exciting new technologies, securing high-tech jobs and the Stanlow’s future at the heart of the UK’s green revolution.”
ENDS
Notes to Editors
About Essar in the UK
Essar Oil UK is a leading UK-focused downstream energy company whose main asset is the Stanlow Manufacturing Complex, one of the most advanced refineries in Europe and situated close to the major cities of Liverpool and Manchester. Stanlow is a key strategic national asset, annually producing over 16% of the UK’s road transport fuels, while playing an important part in Britain’s petrochemical industry by providing key feedstocks. Since acquiring Stanlow in 2011, Essar has invested $1 billion in the Essar Oil UK business.
Essar is a major supplier in the North West and beyond with customers including most of the major retail brands operated by international oil companies and supermarkets, Manchester Airport, leading commercial airlines and the region’s trains and buses. It is the lowest cost supplier into the North West and is highly competitive in supplying adjacent markets. Last year, the company acquired BP assets in the Midlands to further strengthen its logistics infrastructure network.
Essar Oil UK is committed to helping drive the UK’s decarbonisation strategy.
www.essar.co.uk
Media contacts:
Ian Cotton, Head of Communications at: ian.cotton@essaroil.co.uk or 07805 854169.
Simon Pugh, Director, Portland: simon.pugh@portland-communications.com or 07762 657280.
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