Banks freeze $1bn Petroplus credit

27th December 2011, Comments 0 comments

Petroplus, Europe's largest independent oil refiner, said on Tuesday it was not able to buy oil after lenders froze about $1 billion (765,000 euros) in credit lines said to be "critical" to the company's operations.

"We are no longer currently able to buy oil, when usually we buy 500,000 barrels per day," chief financial officer Joseph Watson told the AWP financial news agency.

"We have a serious problem," he said.

Petroplus, which owns five refineries across Europe, announced early Tuesday that "approximately $1 billion in uncommitted lines" under its Revolving Credit Facility had been frozen by lenders.

"These lines are critical to allow the company's operating units to meet their obligations when due," the Swiss firm said.

"The company intends to continue negotiations with the banks for a prompt restoration of the credit lines, and is evaluating additional strategic options to maintain operations in its European refining and marketing system."

Petroplus owns and operates the Coryton refinery in Britain, the Antwerp refinery in Belgium, France's Petit Couronne refinery, the Ingolstadt refinery in Germany and Switzerland's Cressier refinery, with a combined capacity of about 667,000 barrels per day.

Shares plummeted following the announcement, dropping 37.1 percent to 2.12 Swiss francs at 0940 GMT.

© 2011 AFP

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