An agreement was signed in July 2014 to acquire the Milford Haven refinery located on the west coast of Wales from MURCO Petroleum.
Currently in a period of shut-down, the refinery will be decommissioned and operated only as a petroleum storage and distribution terminal.
UK Economy Minster Edwina Hart said: "This is a devastating blow to staff at the Murco refinery and companies within the refinery’s supply chain, as well as the local communities around Milford Haven."
Located on 938 acres at Milford Haven, Wales, UK, the modern cracking refinery features a competitive configuration and has the ability to manufacture ultra-low sulphur transportation fuels and comes with a production capacity of 135,000 bpcd.
BBC cited UK Preseli Pembrokeshire MP Crabb as saying: "The loss of those jobs will leave a very big hole in the economic activity of west Wales and it will take a number of years for the local economy to recover.
"It does feel very much like it’s reached the end point. We’re very, very disappointed."
A buyer is also being considered by Murphy Oil for the terminal facility along with three inland terminals.
