Administrators at the Coryton oil refinery in Essex have confirmed that the site is to close after no buyer could be found to keep the plant going.
PricewaterhouseCoopers (PwC) have struck a deal to sell most of the assets to a consortium of companies including Shell, Royal Vopak and Greenergy.
The refinery, which supplies 20% of fuel in London and the south east, will be closed over the next three months and converted into an import terminal.
PwC said there would be no change to the redundancy programme, with 180 out of around 850 staff and contractor jobs to be cut by the end of June, with further redundancies planned to take place from July onwards.
Linda McCulloch, national officer of Unite, said the news was “devastating” for the workers.
She added: “They feel they have been led up the garden path by the administrators and let down by the government.
“This will have huge economic consequences, not just in the region, but on the UK economy and will undermine the refining industry.
“It confirms our suspicion that this was the plan all along. We will do all we can to achieve justice for our members at Coryton, who have worked tirelessly to try to save one of the most efficient refineries in Europe."
Energy minister Charles Hendry said he was seeking to help the affected workers, but stressed there would be substantial investment in the site by its new owners, with plans for some recruitment.
He said: “We are doing everything we can to help these skilled people to find new posts, and are working with the Thurrock Council taskforce, local agencies and Jobcentre Plus to ensure they get the support they need at this difficult time.
“Vopak, Greenergy and Shell have committed to investing a substantial amount in the site to develop it as a state-of-the-art import terminal. This includes paying for enhancements to the infrastructure that will keep the site viable for many years.”
Hendry stated that the buyers are expected to create around 50 jobs directly at the site, with additional jobs available for contractors with skills in maintenance, security, engineering, truck driving and construction.
Steven Pearson, joint administrator and partner with PwC, said: “Ultimately, the administrators have a legal responsibility to achieve the best price possible for the assets and we have been able to obtain the highest price by selling the site for an alternative use.
“We recognise that the closure results in the redundancy of the majority of the employees at Coryton and we intend to work with the local agencies and authorities to provide assistance during this difficult time.”
Labour's shadow energy minister Tom Greatrex said the government had “serious questions” to answer over Coryton's closure.
“It is deeply disappointing that hundreds of skilled workers at Coryton will lose their jobs. Ministers have serious questions to answer about whether the government could have done more to keep Coryton open as a fully functioning refinery.”
Phil Whitehurst of the GMB union added: “Even at this late stage the government should step in and knock heads together to keep open a refinery supplying 20% of the fuel for the region. This is because the other refinery owners have an economic interest in seeing it closed for the chance to keep prices high as crude oil prices drop.”
The future of the refinery will be raised in a Commons debate today by South Basildon and East Thurrock's Conservative MP Stephen Metcalfe.