UK-based BP Plc has been granted the licence by the petroleum ministry to set up 3,500 retail fuel stations to sell petrol and diesel in India, a senior government official confirmed to FE.
UK-based BP Plc has been granted the licence by the petroleum ministry to set up 3,500 retail fuel stations to sell petrol and diesel in India, a senior government official confirmed to FE. This is in addition to an earlier permission allowing BP to sell aviation turbine fuel (ATF) in the country.
BP would be the second company from overseas, after the Netherlands-based Shell, eyeing a pie of India’s fuel retail market. Petrol was freed from government control in June 2010, while diesel prices were deregulated in October 2014?, which is prompting the private fuel retailers to bet their stake in the retail market.
Current the retail fuel market is being dominated by the government-owned companies, while Indian private firms such as Reliance Industries and Essar Oil has a marginal presence. Recently, the petroleum ministry has given its go-ahead for the proposal put up by Haldia Petrochemicals Limited to start retailing of transportation fuel. ?The company plans to set up 50 pumps in West Bengal and Bihar.?
“BP sees a strong future for transportation fuels in India. We are keen to be involved in this market and contribute to its development. Towards this longer term objective, we can confirm we have been granted approval for marketing for ATF and have additionally applied for an authori?s?ation to market MS? (petrol)? and HSD? (diesel),” BP spokesperson said in a statement on Thursday evening.
The public sector players — IOC, BPCL and HPCL — operate nearly 56,190 fuel pumps across the length and breadth of the country with IOC topping the list with around 25,363 stations, HPCL has 13,802 pumps and BPCL has another 13,439 retail outlets. Private retailer Essar Oil is operating 2,400 pumps and are in the process of putting another 2,800 stations in next 18 months. The Ruias-promoted firm targets to reach 4,300 pumps in this financial year .
“Entry of more number of private players in the fuel retailing will make the sector more competitive. The decision exemplifies the government’s continuing emphasis on promoting ease-of-doing-business and also in line of Make in India philosophy,” a senior petroleum ministry official told FE.
In the current policy framework, a company investing or proposing to invest Rs 2,000 crore is exploration and production, refinning, pipelines, or terminals is eligible for granting authorisation of marketing transportation fuels including petrol, diesel and aviation turbine fuel (ATF). The government also extended permission to UK’s BP to roll out ATF retailing in India.
India imported 202.9 million tonnes of crude oil in FY16, 7.11% higher than 189.43 million tonnes of imports in FY15. The energy demand, particularly for petroleum products are peaking up fast in the Asian nation.
In August, the demand for petroleum products witnessed the quickest jump of 11% year-on-year, highest in the past five years. This growth is primarily led by diesel and petrol growing at 14% and 25%, respectively year-on-year.