Prax Group has significantly enhanced its liquidity position with lenders.
The company behind Lindsey Oil Refinery has upsized its securitisation facility by almost 30 per cent, from £575 million to £739 million.
It said it would provide the group with “increased resilience to high prices and a solid platform from which to execute its strategic objectives and to support its future growth plans”.
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The British oil industry multinational, which added the huge refining capability to its storage, distribution and sales operations in March last year, has mandated HSBC Bank Plc as arranger, with HSBC UK Bank Plc, Citi, JPMorgan Chase Bank, NA, and Royal Bank of Canada as senior note purchasers.
A spokesperson said: “This demonstrates the confidence that the securitisation participants have in the strength of the group's business model and its vision for the future.”
Prax has added two vessels to its tanker fleet in recent months, to support distribution of fuels from the North Killingholme plant.
It had agreed a deal for the original finance facility hours after completing the purchase, which was agreed in the summer of 2020.
The 28.5 per cent uplift comes as Lindsey Oil Refinery was one of four Humber successes in the latest government carbon capture use and storage sequencing. It now enters the due diligence stage of BEIS’s Phase-2 Cluster Sequencing process, which in turn opens the potential to access government funding.
The proposal would see CCUS technology deployed, with a connection to pipeline transportation to storage under the North Sea, itself a wider Humber project. Prax described the project as one that is a “a boost not just for the refinery but for the Humberside area more generally, and will support jobs and investment”.
Luc Smets, refinery general manager, said: "We are extremely pleased to have been selected for the next phase of CCUS sequencing. This underlines our determination to support the local economy and the wider community, whilst enabling us to explore new, sustainable business opportunities. As a dynamic and forward-thinking organisation, we consistently look for ways to keep our business innovative so that we can continue to meet the needs of our customers, whilst being mindful of the planet and its resources. Committing to decarbonising our emissions represents the firm commitment we have to minimising adverse effects on the environment, wherever it is practical for us to do so. In this, we are committed at all levels and within all functions of the Prax Group."
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