There was devastating news for the staff of the Murco Milford Haven Refinery and their families last night (Tuesday) as the deal to buy the site fell through.

in an announcement in the United States, refinery owners Murphy Oil said: "Murco Petroleum Limited (“Murco” or “the company”), a subsidiary of Murphy Petroleum Limited (“Murphy”), regrets to announce that its agreement to sell the Milford Haven Refinery and terminal assets to Klesch Refining Limited is no longer in effect. Despite every effort by Murphy to complete this sale process, conditions necessary for the sale were not able to be met. The parties are not engaged in further discussions.

"Murco has run this sale process for over four years, and has engaged with a large number of potential buyers of these assets. The Company has now exhausted all options available for the sale of the site as a refinery, and is therefore left with no choice but to operate the site solely as a petroleum storage and distribution terminal.

"The refinery is currently in a period of shut-down and will be decommissioned while the company seeks a buyer for the terminal facility along with the three inland terminals. While the terminal facility will continue to employ personnel in Pembrokeshire, this will unfortunately still mean a significant number of redundancies.

"Murco’s employees continue to be its number one priority, and the company remains committed to doing all it can to ensure they are supported. We will now re-convene consultations with those affected and work to help them through this difficult period.

"We would like to reiterate that the completed sale of Murco’s retail assets is separate and unaffected."

Commenting on today's announcement, Bryan Kelly of Murphy Oil Corporation said:

“It is with great frustration and regret that we make this announcement. For the past four years we have worked tirelessly to secure a positive outcome for the future of the refinery and our workforce. Unfortunately, and despite every effort on the part of Murphy and our employees, we have been denied the desired outcome. While we know this is a difficult time, we are continuing to support employees as much as possible.

“I would like to thank all Murco staff for their continued professionalism and commitment during the sales process, as well as placing on record my appreciation for the efforts of the UK Government, and the Welsh Government and its Task Force.”

The original October 31 deadline for the deal to sell the refinery to The Klesch Group came and went without being signed.

The deadline had been extended to try to get the deal done but this evening's announcement has ended hopes that the sale could be completed.

All had appeared to be progressing smoothly but a series of complications saw negotiations stall at a critical time.

Preseli Pembrokeshire MP Stephen Crabb said this evening: "This is an incredibly disappointing outcome. I feel desperately sorry for the workforce and their families who have endured months of uncertainty only for the sale to collapse once again. Right up until late last week everything looked on track.  

 

"When it became clear that last Friday's deadline was not going to be met we worked through the night to persuade Murphy to keep talking to the buyer. They showed a lot of good will by once again extending their deadlines but clearly now have taken a view that there is no chance of completion within an acceptable timeframe.

 

"I am grateful for the enormous efforts made by the Energy Secretary and the First Minister over the weekend in trying to keep the deal moving forward. I genuinely don't believe there is anything more that could have been done from the UK or Welsh government side to hold this together.

 

"We all now need to focus on how we minimise the significant economic impact the closure will have on our County. Both the UK and Welsh government will shortly outline a package of measures to help those affected. I am committed to working closely with them to ensure that those losing their jobs get the right support at this time.

 

"I will be holding an open surgery from 12.30pm this Friday at Cedar Court, Milford Haven for Murco employees and families affected to discuss the situation. For further information: contact my office on 01437 767555."

Preseli Pembrokeshire Labour candidate, Paul Miller, added: "Tonight's announcement is a hammer blow for those working at Murco and for their families.

"My father and both my brothers have worked on the site over the last 30 years. One brother still does. I know first hand just how devastating this news is for my family and it will be exactly the same for countless families from right across Pembrokeshire."

Welsh Government Minister for Economy, Science and Transport Edwina Hart said:

“This is a devastating blow to staff at the Murco refinery and companies within the refinery’s supply chain, as well as the local communities around Milford Haven. Murco has been integral to the fabric of the oil and gas infrastructure in Wales and the Welsh economy for many years.

“This news is especially disappointing as the Welsh Government did everything we could to support the success of this deal. Working with close co-operation from UK Government departments Welsh Government officials have been fully engaged with both parties at the highest levels for many months to try to secure the ongoing operation of the refinery and protect the jobs at the Milford Haven site.

“Our support for the Murco refinery and its staff will not stop here. We have been working with management at Murco since 2010 to try to maximise the opportunities for the sale of the refinery. In April I established a task force to marshal support from high level stakeholders for the maintenance of refinery operations at the site for the future. The work of this task force will carry on to maximise the opportunities for employment at the site. 

“We will all continue to work tirelessly with Murco management to maximise the opportunities for employment at the site, ensure the ongoing viability of the terminal and assist to find a new owner. Workers seeking retraining and employment will receive support through React and we will assist supply chain companies to create and explore new markets and opportunities through Business Wales.”

Wales Office minister Baroness Randerson said: 

"This is extremely disappointing news for the workforce at Murco and their families.

Both the UK and Welsh Government have worked tirelessly throughout this process to try to secure the future of the refinery and it is regrettable that ultimately a buyer has not been able to reach a deal with Murphy Oil.

“Supporting the staff at Murco is now our immediate concern and we stand ready to assist in any way we can."

Reaction floods in to devastating news: Click here.