[dZired]

British Petroleum (BP), Europe's third largest oil company, will soon be setting up its petrol pumps in India. This development comes after the Government of India granted a license to the firm for operating 3,500 petrol pumps in the country. BP Plc has thus become the 10th company to enter India's fuel retailing business.

Earlier this year, BP had also earned an in-work approval for retailing Aviation Turbine Fuel (ATF) in India, which was later extended to a full approval. A spokesperson from the company's Indian arm had last month pointed towards their plans to enter the fuel retailing sector as well.

In 2011, BP entered into a partnership with Reliance Industries, under which the former bought a 30% stake in 23 oil and gas exploration blocks of the latter. The two companies also formed a 50:50 Joint Venture for sourcing and marketing of gas in the country.

Currently, there are 56,190 petrol pumps in the country, with majority of being operated under the realms of public-sector firms like Indian Oil Corporation Limited (IOCL), Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL). The two major private fuel retailers are Essar Oil and Reliance Industries, which cumulatively have around 3,500 pumps. Royal Dutch Shell is another private player with 82 petrol pumps.

Source: ET Auto

Link to Team-BHP News

[SchumiFan]

I am hoping they are more on the highways with all the facilities that they offer in other parts of the world. More than fuel, it is the facilities that are lacking in our country. Even if they have very few outlets but have them stocked fully, that will be greatly helpful. Having self serving booths will be a welcome addition as well. But am not sure if it will work with out country's insistence on the OTP.

In the US, one can see them bang opposite to the Shell outlets mostly 'Invigorate' tech should come as well.

[bobbafett]

Interesting move. I guess the challenge for BP would be regulatory; governments in India tend to change regulations at their whims.

Expect to see BP cover the metros fairly quickly, though what would really be awesome is if they start setting up highway fuel outlets too. Quality fuel is still a lottery on Indian highways.

[invidious]

I thought they would be a bit careful about their expansion plans after their major oil spill cost them billions. I hope they don't take things lightly in India. Competition is always good but to be honest I have never seen a Reliance Petrol Pump and it has been eons since I saw a Shell petrol pump in Bombay. I've predominantly stuck to HP which I have been verbally assured by people is more reliable than Indian Oil and the others - I'd be happy if I had a British Petroleum or Shell in the vicinity.

[CrAzY dRiVeR]

They should start with Bangalore, where Shell seems to have established themselves in a good way. I myself stick to Shell fuel whenever possible and use other options only during outstation travel.

But even Shell has struggled to establish a good footprint elsewhere in the south.

[SmartCat]

eh? I think some of these business decisions are taken by management to show shareholders that they are doing something.

In 2016, we started retail operations in India, one of the fastest growing large economy. We plan to setup 3500 retail outlets over the next few years. We are committed to diversifying across various geographies

Above looks good in the Annual Report, no?

[ike]

I understand that BP acquired Essar and would be operating the pumps that Essar currently has.

[deetjohn]

Originally Posted by ike

I understand that BP acquired Essar and would be operating the pumps that Essar currently has.

Is this confirmed?

That would have been great though! There are many Essar pumps here in Kerala which are abandoned, especially in the semi urban and rural areas when they couldn't sustain the regulated pricing of fuel and shut shop a few years back. So much waste of land and capital.

But I read Russia's Rosneft Oil Company acquired Essar Oil in an all-cash deal valued at about 13 billion US dollars a few days back.

Also, France's Total and Saudi Aramco are coming soon.

Source

[timuseravan]

Fantastic news! I have always had great service with Shell and not a single attempt at trying to cheat in some way. This is contrary to even the best operated govt oil companies.
With all these private international companies coming up hopefully cheating at petrol pumps should be a thing of past.

[rohitoasis]

Originally Posted by dZired

British Petroleum (BP), Europe's third largest oil company, will soon be setting up its petrol pumps in India.

Slightly OT but a small point. BP though referred earlier on as British Petroleum is no longer called as British Petroleum.

[Saanil]

Do the metro cities have enough space to accommodate more fuel stations? I am of course happy to see another option for me but I do not think they will get good locations in urban cities that easily.

[Mohan Mathew A]

Originally Posted by ike

I understand that BP acquired Essar and would be operating the pumps that Essar currently has.

Essar (including the fuel retailing business) has been taken over by Rosnet and not BP

Originally Posted by Saanil

Do the metro cities have enough space to accommodate more fuel stations? I am of course happy to see another option for me but I do not think they will get good locations in urban cities that easily.

Some of then could switch loyalties (if the contract allows that) in favour of these companies. I am sure they will make it worthwhile for them to do so.

[V.Narayan]

This reminds me of a economic incident from 1957. In those days sale of petroleum in India was largely monopolized by Esso, Burmah Shell and Caltex (American and Anglo-Dutch MNCs). The Govt of India wanted to reduce the price of retail diesel but could not do so thanks to the control these 3 had over the entire supply chain. In those days their control extended to even the tanker ships that brought the oil to our shores. It is a reflection of MNC attitudes of those early post-colonial days where being an MNC (especially in the oil sector) meant exercising political and economic clout over the host country. These 3 refused to co-operate with the Govt. I do not know what the terms were. In order to exercise control over our own economic destiny the Govt. of India got in touch with the USSR who despatched a products tanker with diesel oil ready to distribute. This determination of our Govt caught the 3 Western petroleum MNCs by surprise. The day that tanker docked in Bombay the 3 MNCs dropped diesel prices and complied with the Govt order. Today MNCs come here on our own terms and that is the way it should be. Back then till certainly the late 1970s their attitudes had a strong colonial economic flavour to it. From this experience was born Indian Oil in 1960 and ONGCs off shore success at Bombay High in the early 1970s. Not sure why we need BP to trade in oil in India. Not sure what value it adds other than some who may claim BP will sell better quality petrol or diesel. So welcome back BP - this time on our terms. Your coming here as a trader is not likely to add value to this nation in my opinion. To contribute to our national development, build refining capacity.

[gauravdgr8]

Originally Posted by V.Narayan

. Your coming here as a trader is not likely to add value to this nation in my opinion.

It will surely add some jobs. As the economy grows and the consumption cycle catches up, 2+2 surely adds up some good numbers on a pan India basis.

[timuseravan]

Originally Posted by V.Narayan

Not sure why we need BP to trade in oil in India. Not sure what value it adds other than some who may claim BP will sell better quality petrol or diesel. So welcome back BP - this time on our terms. Your coming here as a trader is not likely to add value to this nation in my opinion. To contribute to our national development, build refining capacity.

The value added is the good service, good quality petrol and hassle free experience where I don't have to be on lookout for the multiple attendants and the pump meter to ensure I am not being cheated.
The biggest value add is more competition which will keep the Govt Oil Companies on their toes and keep prices at competitive levels benefiting the end consumers.