Swiss oil refiner Petroplus
Talks with banks are ongoing and we hope that a deal will be reached as soon as possible, Jean-Paul Vettier told reporters on Thursday on his way out of a meeting with French Prime Minister Francois Fillon in Paris.
We will do everything we can to avoid bankruptcy... An alternative solution lies in an oil company that could give us oil but also credit lines. Negotiations are underway, Vettier said, without naming the company.
The European refining industry is struggling with depressed margins as a result of overcapacity and the prospect of a Petroplus demise has already boosted margins, suggesting its peers have little to gain from supporting it.
Bankers say Asian oil and gas groups are one of the few potential buyers of European refining assets, as the companies believe they need an international footprint to help their global trading operations.
Essar Energy said such an ambition was behind its purchase of Shell's Stanlow refinery in the UK last year.
Petroplus has been locked in talks with 13 banks after lenders froze a $1 billion credit facility the group relied on to buy crude oil.
This has forced Petroplus to shut down its low-performing Petit-Couronne refinery in France, which employs 550 people. Vettier said its refineries in Britain and Germany were working at minimum production levels.
Petroplus has some 4.4 percent of total European refining capacity, with plants in Coryton in Britain, Antwerp in Belgium, Ingolstadt in Germany, Cressier in Switzerland and Petit Couronne.
The French government has offered support to the company. French Energy Minister Eric Besson said on Thursday state aid could take various forms and would not necessarily be financial.
The French government, which experienced its worst ever refining sector strike last year, is keen to see a successful outcome as it heads into presidential and parliamentary elections in the spring.
Data last week showing France's jobless rate at a 12-year high will likely make the government more anxious to preserve jobs at Petit Couronne.
A company insider told Reuters that Petroplus has appointed an external auditor to value the business, come up with a cost-cutting programme and identify its most profitable assets for potential disposal.
Petroplus and its lenders and auditors have been locked in meeting rooms for days and a plan could emerge early next week after a key meeting this Friday, the insider said.
They are quite pessimistic about the company's future, he added.
The alternatives could include selling the poorest performing refineries in France, Belgium and Switzerland to focus on the most efficient ones in the UK and Germany.
The weaker refineries could appeal to oil storage companies such as France's Rubis
Other oil companies have been converting refineries they could not sell into terminals or storage units, which can support their logistics and oil trading businesses while avoiding a costly clean-up that a permanent closure would entail.
(Additional reporting by Axelle du Crest in Paris and Sophie Sassard in London; Writing by Chris Wickham; Editing by Christian Plumb and David Cowell)