State Oil — the parent company of Prax Group, which owns the Lindsey refinery in North Lincolnshire, England — appointed administrators on Monday.
A separate winding-up order has also been made against the Lindsey oil refinery and related businesses and a liquidator has been appointed.
More than 180 staff are employed by State Oil, while it is thought that around another 420 work at the Lindsey refinery.
British energy minister Michael Shanks said the firm’s collapse was “deeply concerning” and that the company had left the government with “little time to act”.
He said the government is demanding an investigation into the conduct of the company’s directors and the circumstances surrounding its failure.
The Lindsey site is one of only five large oil refineries remaining in Britain after the recent closure of the Grangemouth plant in Scotland.
Prax Group is led by majority owner and chairman and chief executive Sanjeev Kumar Soosaipillai, who bought the Lindsey oil refinery from French firm Total in 2021.
Mr Shanks said: “There have been longstanding issues with this company, and workers have been badly let down.
“The secretary of state is today writing to the insolvency service to demand an immediate investigation into the conduct of the directors and the circumstances surrounding this insolvency.
The government will ensure supplies are maintained, protect our energy security, and do everything we can to support workers and the local community, including engaging with trade unions and industry bodies
He added: “The government believes that the business’s leadership have a responsibility to the workers and the local community.
“We call on them to do the right thing and support the workers through this difficult period.”
‘Protect workers’
Trade union Unite said the government needed to urgently intervene to help protect British fuel supplies and jobs.
Unite general secretary Sharon Graham said: “The Lindsey oil refinery is strategically important and the government must intervene immediately to protect workers and fuel supplies.
“Unite has constantly warned the government that its policies have placed the oil and gas industry on a cliff edge.”
Built in 1968, the Lindsey refinery can process around 113,000 barrels of oil a day.
Clare Boardman, a joint administrator of State Oil and Prax, said: “We appreciate that this is a very difficult and uncertain time for the employees and everyone involved, and we will be on site to support them during this challenging period.
“We will be considering all options for the group, including the prospect of a sale for the group’s upstream business and retail operations in the UK and Europe, all of which remain outside of insolvency.
“We thank the group’s team members and other stakeholders for their continued support.”
Prax Group was not immediately available for comment.
