Igor Yusufov remains interested in buying the Coryton refinery in Essex, say people close to both sides of the talks. The plant, a unit of bankrupt Swiss oil firm Petroplus, has run out of oil and its workers will be laid off if no deal can be reached.

Coryton is one of only seven working refineries in the UK.

Yusufov, who was energy minister during Vladimir Putin's first term as president, has faced questions about a past deal involving the purchase of a Norwegian shipyard group that he helped finance.

It subsequently failed, although before it went bankrupt some assets were transferred offshore in a transactions deemed illegal by the official receiver. The group's former owner died in a shooting last year that remains unsolved.

Yusufov denies any role in the alleged asset stripping or the killing, according to someone familiar with his thinking.

His investment vehicle, Fund Energy, is the only bidder left seeking to operate Coryton as a refinery, and has been asked by administrator PricewaterhouseCoopers to submit a best and final offer.

"We are still having discussions but there has not been an acceptable economic proposal, and until there is, I don't expect a sale," Steven Pearson of PwC said last week.

A spokeswoman for Britain's Department of Energy and Climate Change said it is up to the administrator to secure a sustainable future for the plant. "The UK welcomes inward investment to our energy sector but any bid for UK energy assets is, and would be, subject to the usual, rigorous scrutiny."

Other potential bidders for the site would use it as a storage terminal, which would leave many more without jobs.

"I don't know about the integrity or detail of the bid, but given the corner that we are in, it is important that the bid is given every chance to succeed," said Richard Howitt, a member of the European Parliament for the region. "It is the responsibility of the government and the administrator that this refinery can be made to work."

In an unrelated case, a Greek court last month blocked Yusufov's Fund Energy from bidding for state gas firm DEPA. Christos Konstas, a spokesman for the country's privatisation agency, said it had failed to prove its source of funds or its ability to manage the asset.

The source close to Yusufov said the Greek court's decision was not final, that Fund Energy was still interested in bidding for DEPA and had provided the necessary financial guarantees. A further hearing on the matter is scheduled next month, the source added.

GERMAN RESCUE

Yusufov, 55, was an energy adviser in the Kremlin under Dmitry Medvedev until April 2011. He is a director at gas export monopoly Gazprom (GAZP.MM).

In 2008, according to the person familiar with his thinking, he helped an associate, Andrei Burlakov, raise a 200 million euro ($250 million) loan to buy Norwegian shipbuilder Wadan Yards which owned shipyards in Germany and Ukraine, in an attempt to turn the business around.

When that failed, Wadan was split up. Yusufov's son, Vitaly, bought the German operations in a deal that Chancellor Angela Merkel backed to save jobs. She visited Medvedev to lobby for the 40.5 million euro sale, praising the Yusufovs as "seriously interested" investors.

Vitaly Yusufov, 32, had previously run the Moscow office of Nord Stream, a pipeline project to export Russian gas under the Baltic Sea to Europe that is chaired by former German Chancellor Gerhard Schroeder. He moved the German shipyards into a new German-based firm, called Nordic Yards. They remain in operation.

UKRAINE TRANSFER

The Ukrainian asset, the Okean Shipyard on the Black Sea coast, met a more controversial fate.

Wadan Yards, the Norwegian parent company, was declared bankrupt in March 2010. Just before then, its shares in the Ukrainian yard, held through a Dutch subsidiary, Okean BV, were transferred to a firm called Blakur, based in the British Virgin Islands, according to official receiver Johan Ratvik of DLA Piper Norway.

Ratvik, in a December 2010 letter, said he viewed this share transfer as illegal as it took place after bankruptcy proceedings had opened, that it should be revoked and investigated as a criminal act by the Norwegian police. No investigation was launched.

He wrote that in his view Igor Shaposhnikov, chairman of Wadan and Okean at the time of the deal, was criminally responsible.

Ratvik passed his findings to the Oslo police but no investigation was launched, he told Reuters. A Norwegian police officer to whom Ratvik passed the case declined comment.

Shaposhnikov was fired in late 2010 after Okean was acquired from the receiver by Kostyantin Zhevago, a Ukrainian metals and mining magnate. Shaposhnikov could not be reached for comment.

The alleged asset stripping is now the subject of a Dutch court case in which Zhevago, who still owns Okean, is trying to recover the assets. A writ issued by Okean in April names Blakur and a number of other offshore companies among defendants. The writ does not name the Yusufovs.

The case comes to court in September.

Burlakov, the associate who was helped by Yusufov to finance the 2008 takeover of Wadan, stated after the shipyard's collapse that Yusufov had been in effective control of the business all along - an allegation denied by Vitaly Yusufov.

UNSOLVED KILLING

Burlakov and his former partner, a banker called Anna Etkina, were held in Russia in late 2009 in an investigation into whether they had misappropriated funds to pay for the shipyard deal. They were released separately on bail in 2010, and went on to allege in summer 2011 that Igor Yusufov, not Burlakov, had been the beneficial owner of the Wadan Yards group.

Burlakov - who had a coronary condition - was shot on September 29, 2011 in a Moscow restaurant by an unknown assailant with a pistol that shoots rubber bullets. These are sometimes used to deliver warnings in criminal disputes. Burlakov died of a heart attack. Etkina, who was with him, was shot in the head and chest and wounded.

Vladislav Tkachenko, Etkina's legal representative, told Reuters she was shot after testifying that Igor Yusufov still controlled the Ukrainian shipyard assets. "Igor Yusufov controlled assets that have been frozen and he has participated in fraudulent schemes," Tkachenko told Reuters at a meeting attended by Etkina.

Igor Yusufov has kept silent in public. His son Vitaly has denied that his father was the ultimate owner of Wadan Yards, and dismissed all other allegations of wrongdoing.

"It is unworthy for me to comment on such groundless allegations against my family," Vitaly Yusufov told newspaper Vedomosti last week when he was asked whether his father had stood to gain from Burlakov's death. He has declined to comment to Reuters about the UK refinery bid, referring such queries to his father.

The Investigative Committee, Russia's equivalent of the FBI, had no immediate comment on the murder investigation it opened over Burlakov's death. Etkina's representative Tkachenko said he had not yet filed any related case with Russian prosecutors.

($1 = 0.8089 euros)

(Additional reporting by Melissa Akin in Moscow,; Editing by Dmitry Zhdannikov and Sara Ledwith)

• A Permanent Economic Emergency