Europe's biggest independent refiner goes into administration along with its subsidiaries in France, Germany, Switzerland and the UK.

Petroplus, Europe’s largest independent refiner, filed for insolvency on January 25, after negotiations with lenders failed to result in the resumption of its credit facilities. Petroplus operates five refineries across Europe: the Coryton refinery in the UK; the Antwerp refinery in Belgium; the Petit Couronne refinery in France; the Ingolstadt refinery in Germany; and the Cressier refinery in Switzerland. The refineries have a combined throughput capacity of 667,000bpd. The company employs around 2,500 workers.

The company announced that it and its subsidiary in Switzerland, Petroplus Marketing AG, filed for composition proceedings. Petroplus Holdings AG also announced its subsidiaries in Germany, Marimpex Mineralöl-Handelsgesellschaft mbH, Petroplus Deutschland GmbH, Petroplus Bayern GmbH, Petroplus Tankstorage Holding Deutschland GmbH and Petroplus Raffinerie Ingolstadt GmbH, filed for insolvency proceedings. The latter owns the Ingolstadt refinery. A court appointed Jaffé Rechtsanwälte Insolvenzverwalter as administrator for the assets of these companies.



Petroplus also announced that its subsidiaries in France, Petroplus Holdings France SAS, Petroplus Marketing France SAS, Petroplus Raffinage Reichstett SAS and Petroplus Raffinage Petit-Couronne SAS, which owns the Petit Couronne refinery, filed for rehabilitation proceedings. A court has appointed FHB Administrateurs Judiciaries as administrator for the assets of some of these companies.

“The negotiations with the lenders under the revolving credit facility have not been successful (despite the company having reached an agreement for crude oil supply) and they have served notices of acceleration, commenced enforcement actions and appointed a receiver in respect of Petroplus Marketing AG’s assets in the UK. Such acceleration constitutes an event of default under the US$1.75 billion aggregate principal amount of outstanding senior notes and convertible bonds of Petroplus Finance Limited,” said a company statement issued on January 24. 



Petroplus Holdings AG said that its subsidiaries in the UK, Petroplus Refining & Marketing Ltd (the owner of the 220,000bpd Coryton refinery) and Petroplus Refining Teesside Ltd (the owner of the Teesside marketing & storage facility), applied for and were granted administration orders on January 25. A court has appointed PricewaterhouseCoopers as administrator for the assets of these two companies.

In the UK, BP could be most affected by Petroplus’s plight, given that it is the Coryton refinery’s largest customer. However a BP spokesperson told GTForum: “At the moment we see no immediate problems with supply for our network in the southeast and we’re obviously monitoring the situation and are in contact with Coryton and Petroplus… The message for UK motorists is that there’s no supply disruption.”

Petroplus began its journey to insolvency on January 3, when lenders opted to freeze the company’s US$1 billion credit facility. It posted a net loss of US$146.6 million for 3Q11 and made net losses of US$413.3 million and US$250.3 million in the first nine months of 2011 and 2010. 

The refiner has already closed its Cressier refinery in Switzerland and is seeking to sell its Petit Couronne refinery in France. The Antwerp refinery was expected to be shut down shortly after January 5. GTForum has summarised the Petit Couronne refinery’s recent history and technical specifications here.


“The primary goal of Petroplus’s board of directors is to ensure that operations are safely shut down and to preserve value for all stakeholders. The board of directors has resolved to prepare for a filing for insolvency or composition proceedings (“Nachlassstundung”) in Switzerland and will make the necessary filings as soon as possible. Similar steps are being taken by Petroplus subsidiaries in various jurisdictions,” says the company statement.



Jean-Paul Vettier, Petroplus’ chief executive officer, says: “It is unfortunate to have reached the point where the executive committee and board of directors have to inform our employees, shareholders, bondholders and other stakeholders about these circumstances. We have worked hard to avoid this outcome, but were ultimately not able to come to an agreement with our lenders to resolve these issues given the very tight and difficult European credit and refining markets. We are fully aware of the impact that this will have on our workforce, their families and the communities where we have operated our businesses.”

GTForum has analysed the ramifications of the full closure of Petroplus’s refineries, with analysts from Deutsche Bank predicting it will mean lower demand for Russian, North Sea, Nigerian and Kazakhstani crudes and that “it will also aggravate Europe’s net short position for gas oil.”