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Five bids received for France’s ex-Petroplus refinery

The Petroplus refinery is seen in Cressier near Neuchatel, in this file picture taken Jan. 4, 2012. The company filed for bankruptcy in January 2012.


France has received five offers for the takeover of its troubled Petroplus refinery, two of them "serious," as a deadline passed on Tuesday for potential bidders to submit offers to legal administrators.

The government is hoping to avoid a liquidation.

Late on Tuesday, French Industry Minister Arnaud Montebourg described as "serious" the offers received by Switzerland's investor group Terrae and Egypt's energy company Arabiyya Lel Istithmaraat.

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Big oil firms have shown no interest in the Normandy-based Petit-Couronne refinery, France's oldest, as oil demand in Europe has dropped sharply and the industry struggles with overcapacity.

When contacted by Reuters, a spokesman for Arabiyya Lel Istithmaraat was not immediately able to comment.

Another known firm bidder for the 161,000 barrels-per-day refinery is NetOil Inc., led by Middle Eastern businessman Roger Tamraz.

He submitted an improved offer after the commercial court in Rouen in northern France rejected an initial bid on financial and technical grounds last year.

Earlier on Tuesday, Mr. Montebourg said France was ready to help in a potential takeover.

"We are available to go along with a bidder, we said so to the ones which looked into the project," he told French radio RTL, adding that the state was ready to take a minority share.

Mr. Montebourg sought to strike a deal with Libya's sovereign fund in November, but the Libyans said they had only sent a letter of intent.

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The minister insisted on Tuesday that the possibility of a Libyan involvement remained "serious."

"Oil-producing countries have an interest in taking positions on the European market for when production picks up," he said.

The government has also ruled out a possible offer by Iranian firm Tadbir Energy because of international sanctions on Iran.

"The government did everything to rule out the Iranian offer, even though it wasn't in contravention of the embargo," union representative Yvon Scornet said in a statement.

The Petit-Couronne unions met with government advisers on Monday to discuss offers on the table, but have warned of possible industrial action if the plant were to be liquidated.

"If tomorrow a solution is not found, the workers of Petroplus will strike another tone," Mr. Scornet said.

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Mr. Montebourg said chances for a successful outcome were "limited but not impossible."

The Rouen court is expected to rule on the suitability of potential bidders by Thursday at the earliest, after legal administrators submit any firm offers to the court.

If none appear, the court could decide to liquidate the plant, which would lead to the loss of 500 jobs – a scenario the government hopes to prevent.

Socialist President Francois Hollande has vowed to stem rising unemployment by the end of the year but has had to deal with a series of high-profile plant closures.

His government faced sharp criticism over its mixed messages about a possible nationalization during a two-month battle over the future of ArcelorMittal's Florange steel plant.

Mr. Hollande has said the state could at some point provide financing for the Petroplus refinery, but would not take over the plant.

A Petit-Couronne liquidation could also be a headache for former owner Shell, with unions saying the company should be asked to contribute to the cost of dismantling the facility and cleaning up the site.

Shell, which opened the refinery in 1929, sold it to Swiss refiner Petroplus in April 2008. The firm filed for bankruptcy in January 2012.

In December, Shell ended a six-month oil processing deal with the troubled plant and has not extended the contract, making the refinery less attractive for buyers due to expensive re-start costs.

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