One of the largest supplier commercial properties for fuel in the South East is set to wind down over the next three months following its turbulent start to 2012. The Coryton refinery in Essex provides 20 per cent of the fuel sent to pumps all across the South East of England, and the closure of the commercial property will ensure that a potential 1,000 British people will join the ever-increasing number of job seekers in the UK.
January saw the plant placed into administration by its Swiss owner, Petroplus, and therefore halted all sales from the commercial property. Although the commercial property refinery was then re-opened by administrator Price Waterhouse Cooper, and seemed to be gaining back strength it had lost in the first month of the year, the administrator confirmed the shut-down process will begin this week after failing to find a buyer after four months.
The lack of buyer could possibly be down to the fact that funding the commercial property refinery would cost a staggering £625 million. Only a very secure business would have the available finances to take over the plant, and unfortunately the recession means that most businesses are leaning on the side of caution when it comes to large scale investments. Additionally, as the Coryton commercial property has only refined 20 million barrels of oil since February, it would take a long time for any financers to see a return on their mammoth investment.
Price Waterhouse Cooper said in a statement to the press; “Despite this extensive exercise over the past four months, it has not yet been possible to find a solution which sees the refinery continue as a going concern.”
They also warned that there was a high possibility of “substantial redundancies” among the 500 permanent on-site workers, while workers contracted to the commercial property would learn whether or not their jobs will be safeguarded in the coming days.
However, the closure of the commercial property refinery has implications for a wider group than those employed there – the AA, one of Britain’s largest motoring groups, has voiced the concern that this could bump up petrol and diesel prices for the general public. This would be caused by speculators pushing up the wholesale price of refined fuels, with commercial property supermarkets and independent filling stations having to raise prices to make a profit.
The AA has previously warned that the public are being ripped off at the pumps by speculators and oil companies attempting to hit a larger profit margin by profiteering. In fact, this can often lead to motorists paying as much as 4 pence per litre extra.
Luke Bosdet, spokesman for the AA, said; “Our concern is speculators will now seize on this latest news to drive up the price at the pumps because there will be a perceived reduction in supply following the Coryton closure.”
Following the panic buying of fuel earlier this year, Members of Parliament are being very cautious about the issue of fuel sold in commercial property filling stations, fearing a rush to the pumps that could, in fact, cause shortages rather than prevent them.
However, as fuel prices reached an all time high in April, at 142.48p per litre for petrol and 147.93p per litre for diesel, the growing consensus is that the Government must step in to stabilise the prices for the working population. A recent study, showing that most people spend up to a fifth of their monthly wage on filling up the tank, further highlights the need for change.
Do you think the Coryton commercial property closure will cause problems for motorists in the South East and across Britain? Or do you believe that the Government will be able to find an alternative source to fill commercial property filling station forecourts?