Stanlow (UK), May 21 (IANS): Essar Oil (UK) Ltd, which owns and operates the Stanlow Refinery in the UK, on Friday announced that it has closed new financial arrangements of over $850 million.

This has allowed Essar Oil (UK) Ltd (EOUK) to replace its former credit facility as well as access additional capital, thereby strengthening its financial position.

The funding is made up of liquidity from a diversified range of sources, including bilateral arrangements with many of its key customers on enhanced payment terms and other long-term financings, linked primarily to crude supply.

With these financial arrangements now in place, EOUK has more low-cost liquidity to meet its upcoming requirements, and can continue to focus its energies on its transition to become a "Low Carbon Energy Provider" of the future, it said in a statement.

The company is already working on delivering two blue hydrogen production hubs at Stanlow, which will attract 750 million pounds in total investment. Follow-on capacity growth is planned to work towards the UK government's new target of 5GW of low carbon hydrogen for power, transport, industry and homes.

"Stanlow is committed to reaching 80 per cent of the Government-set targets. In addition, EOUK remains committed to delivering the necessary operational cost reductions at the refinery over the course of the coming year in order to help secure its long-term future and to ensure it remains competitive in its traditional refining business," the statement said.

EOUK has also recently completed a review and update of its corporate governance and its Board has adopted the recommendations arising out of that review process, which included independent input from Ashurst LLP. As a result of that process, the Board has committed to appointing two independent Non-executive Directors to the Board.

Commenting on the recent developments, Chairman Prashant Ruia said: "Securing this financing demonstrates the confidence all our stakeholders have in our long-term vision for Stanlow. We believe this confidence will be further bolstered by the updates we have made to our corporate governance, which includes a commitment to appoint two new independent Non-Executive Directors to our Board."

"These appointments will further enhance our overall governance and risk assessment processes, as well as providing insights and strategic inputs to the business as it continues its transition to low carbon operations."

He also said that with a strong economic recovery driven by the UK government's roadmap out of the pandemic, the business has moved into a positive and progressive phase for the benefit of all of company's stakeholders and employees.

"We look forward to furthering our investments in exciting new technologies, securing high-tech jobs and the Stanlow's future at the heart of the UK's green revolution."

Essar Oil UK's Stanlow refinery is a key strategic national asset, annually producing over 16 per cent of the UK's road transport fuels, while playing an important part in the country's petrochemical industry by providing key feedstocks. Since acquiring Stanlow in 2011, Essar has invested $1 billion in the Essar Oil UK business.