Essar Oil UK, the company that operates the Stanlow refinery at Ellesmere Port, has secured a $150m financing deal with two banks to support its working capital and corporate purposes. The deal comes as Essar Oil UK is undergoing a major transformation to become a low-carbon energy producer.
A new receivables portfolio
The financing deal involves a $150m receivables portfolio with Hamburg Commercial Bank AG (HCOB) and Mizrahi Tefahot Bank Ltd (UMTB). The portfolio consists of receivables from Essar Oil UK’s customers, such as airlines, oil majors, and independent retailers. The portfolio will be serviced by Essar Oil UK and will have a revolving nature, allowing the company to access funds as needed.
Essar Oil UK’s chief financial officer, Sampath P, said that the deal was a testament to the company’s strong performance and reputation in the market. He added that the deal would provide additional liquidity and flexibility to the company as it pursues its growth plans.
A low-carbon vision
Essar Oil UK is one of the leading suppliers of road transport fuels in the UK, producing over 16% of the country’s transport fuel demand. The company operates the Stanlow refinery, which has a capacity of 9 million tonnes per annum and employs over 900 people.
However, Essar Oil UK is not just an oil refiner. The company is also investing in renewable and low-carbon energy projects to support the UK’s net-zero ambitions. For instance, Essar Oil UK is part of the HyNet North West project, which aims to create a hydrogen and carbon capture and storage (CCS) hub in the region. Essar Oil UK plans to produce 1GW of low-carbon hydrogen per year from its refinery by 2026, which will be used to decarbonise its own operations and supply other industries and consumers.
Essar Oil UK is also developing a biofuels plant at Stanlow, which will convert non-recyclable household waste into low-carbon fuels. The plant will have a capacity of 75 million litres per year and will reduce greenhouse gas emissions by over 90% compared to fossil fuels.
Essar Oil UK’s chief executive officer, Mark Wilson, said that the company was committed to playing a key role in the UK’s energy transition. He said that Essar Oil UK was transforming itself from an oil refiner to an integrated energy provider, offering low-carbon solutions to its customers and stakeholders.
