Hi Tony,
The engine is as stated before, an Aspinall engine.
The brdatabase site lists several engines with the number 1221, but only one with this wheel configuration. It was indeed built by the L&Y railway company at Horwich near Bolton and came into service Jan 1894 and was withdrawn Oct 1926.
As for the location we can see several things:
The engine is located in the middle (more or less) of around 5 or 6 lines, so it's more likely this was at the Horwich works, or on some sidings rather than on main running lines.
The building in the background looks to be built with bricks rather than Yorkshire stone which leads me to suggest it's somewhere in Lancashire.
My friends at the L&Y society might know the location, I will ask them for you.
Thanks,
Andy.