UPDATE 1-Essar bids for Shell's Stanlow refinery -union rep

* Essar makes bid, given deadline to make firm offer

* Shell will withdraw plant from sale if no deal

* Shell continues to withdraw from European refining (Adds detail)

By Tom Bergin

LONDON, Dec 21 (Reuters) - Royal Dutch Shell Plc (RDSa.L: Quote) has told employees at its Stanlow refinery that India's Essar group has made a "credible" bid for the plant, a union official said.

A Shell spokesman confirmed that the Anglo-Dutch oil giant was in talks with Essar and had given the group until the end of February to come up with a firm bid.

"If by then we cannot get the right value for the assets and do the right deal, they will be withdrawn from sale," the spokesman said in an emailed statement.

"We are not considering closure or conversion into a terminal," he added.

Shell is reducing its involvement in refining, especially in Europe, to invest more money upstream in more lucrative oil and gas production.