An energy firm from Singapore has acquired Murphy Oil Corp.'s remaining facilities in the United Kingdom, including its shuttered refinery in Wales, with plans to turn it into a storage facility.
Puma Energy said Friday it purchased Murphy's refinery in Milford Haven, three inland terminals from Murco Petroleum Ltd. -- a subsidiary of Murphy Oil -- and Murco's wholesale and distribution business in the United Kingdom.
"Puma Energy will apply its extensive experience in fuel storage" and "make Milford Haven a key site securing the supply of energy to the UK and wider region during a period of change in European energy infrastructure," the company said in a news release.
The two main shareholders of Puma, a privately owned company, are Trafigura Group, global commodity trading firm, and Sonangol Holdings, a state-owned energy company in Angola.
This is Puma Energy's first acquisition in the United Kingdom. The company did not say how much it paid for the facilities and business.
A spokesman for Murphy Oil could not be reached Monday by phone or email.
"This seems like a fairly seamless acquisition for Puma in that they are looking to expand their downstream assets," said Carlos Newall, an equity research associate with Raymond James and Associates, adding that the company has recently purchased similar facilities.
"If anything it's a positive for Murphy because they were able to sell those assets," he said.
El Dorado-based Murphy Oil has been operating the site as a petroleum storage and distribution terminal, having shut down the refinery last year after a deal to sell the plant and corresponding facilities to Klesch Refining Ltd. fell through.
Murco Petroleum had planned to sell the refinery and terminal facilities to Klesch, but the company said in November the conditions required for the sale were not met.
Murphy Oil has been trying to divest its refining and retail holdings in the United Kingdom for almost three years in an effort to exit the market.
But the company has struggled to sell the refinery and other facilities because of the challenging refining industry in Europe where margins are at mutliyear lows.
"The refinery business in the U.K. is quite a difficult business to operate," Newall said. "The economics are difficult. It would have to work for the acquire and in this particular, Puma, seems to think that it's a good asset."
The company had said in July that it employed 370 full-time workers at the site in Wales. Reuters news agency reported in November that more than 300 of 450 workers would be laid off as a result of the refinery being closed.
In the same week, a spokesman with Murphy Oil confirmed to the Arkansas Democrat-Gazette that there would be layoffs at the facility.
Puma Energy said in its news release that it is "delighted to be welcoming all of the terminal and distribution employees."
Murphy Oil also sold its retail gasoline assets in the United Kingdom to Motor Fuel Group for an undisclosed amount last year.
Roger Jenkins, chief executive officer of the company, previously said Murphy Oil hopes to transfer about $550 million back to the United States following the sale of its U.K. facilities, including the refinery.
Business on 03/17/2015