Govt grants BP Plc licence to set up petrol pumps in India

Government has formally granted a licence to BP Plc, Europe's third-biggest oil company, to set up 3,500 petrol pumps in India, making it the 10th company to enter the lucrative fuel retailing sector.

The company was granted a formal licence on October 14. "BP granted licence to market Motor Spirit (petrol) and High Speed Diesel (diesel) – another milestone for BP in India," the company tweeted.

The UK-based firm, as also Haldia Petrochemicals Ltd, was given approval by the Oil Ministry to retail petrol and diesel, sources said.

"A significant step in #BP's partnership with India – been granted licence to market Motor Spirit and High Speed Diesel," it said.

A BP India spokesperson had earlier this month stated that: "BP sees a strong future for transportation fuels in India. We are keen to be involved in this market and contribute to its development."

The company had in January this year won in-principle approval to retail aviation turbine fuel (ATF) to airlines in India. Subsequently, it got full approval for that.

"We can confirm we have been granted approval for marketing for ATF," the BP spokesperson said.

For a licence to retail auto fuels – petrol, diesel and ATF, a company should have invested a minimum of Rs 2,000 crore in exploration or production of oil and gas, oil refining, gas or product pipeline or terminals leading to additionally to the existing assets or creation of new assets in the eligible activities.

BP, which had in 2011 bought 30 per cent interest in 21 exploration blocks of Reliance Industries for $7.2 billion, had cited investment of nearly $500 million in oil and gas exploration and production for gaining the licence.

India currently has about 56,190 petrol pumps, with public sector firms operating a majority of them.

Private sector operators are limited to Essar Oil and Reliance Industries, who between them have some 3,500 petrol pumps. Royal Dutch Shell operates 82 petrol stations.

Numaligarh Refineries Ltd (NRL) and Mangalore Refineries and Petrochemicals Ltd (MRPL) are late entrants and have six outlets between them.

State-owned Indian Oil Corp (IOC) owns 25,363 petrol pumps, Hindustan Petroleum Corp Ltd (HPCL) 13,802 stations and Bharat Petroleum Corp Ltd (BPCL) 13,439 outlets.

Kolkata-based Haldia Petrochemicals Ltd (HPL) was the latest company to get licence to set up upto 100 petrol pumps, mostly in West Bengal.

In ATF or jet fuel retailing, there are 205 aviation fuel stations, 100 of which are owned by IOC, 40 by BPCL and 37 by HPCL. RIL has 27 aviation fuel stations at airports while joint venture of Shell and MRPL owns one.