Reuters: Bankruptcy News: UPDATE 1-UK refinery creditors to get just 6.4 pct of claims-PwC

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UPDATE 1-UK refinery creditors to get just 6.4 pct of claims-PwC Jul 31st 2012, 17:10 Tue Jul 31, 2012 1:10pm EDT LONDON, July 31 (Reuters) - Creditors of bankrupt refiner Petroplus's UK operations, mainly the Coryton refinery, will be paid a maximum of just 6.4 percent of their claims, said Steven Pearson, a joint administrator at PwC. The creditors will receive $102 million to $135 million, while their claims are estimated to total $2.1 billion to $2.4 billion, Pearson said on Tuesday. He said that losses of $22-$31 million, sustained in runnning the refinery between January and June, had reduced the amount available for distribution and demonstrated why he had to take the decision to close the plant down PwC announced in June that it was selling the refinery to a joint venture of Royal Dutch Shell, Vopak and Greenergy which plan to turn the site into storage, leading to job losses for the vast majority of the 850 staff working at the site. "It was a difficult decision to take but in economic terms it was relatively straightforward," Pearson told Reuters. "The premium over other options (selling the refinery as a going concern) was substantial, and the status quo was not an option." "This high risk, low reward environment was the main driver in having to cease operations - put simply, we could not afford to incur the ongoing losses associated with continuing refining." He added that the return to creditors was low also because the parent company had loaded some $1.75 billion of debt against the UK division. Link this Share this Digg this Email Reprints

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