India’s new liberalised petrol pump licensing norms allow the setting up of EV charging stations and CNG outlets even before the start of petrol and diesel sales, the government has stated. The Ministry of Petroleum and Natural Gas in a clarification to its November 8, 2019 order that eased norms for setting up of petrol pumps by new entities, said the order provides for petrol pumps selling one new generation alternate fuels like CNG, LNG or electric vehicle charging points alongside retailing petrol and diesel, but does not prescribe an order of them being set up.
”While an authorised entity is required to set up its retail outlets for petrol and diesel… the said entity is required to install facilities for at least one new generation alternate fuels like CNG, biofuels, LNG, electric vehicle charging points etc at the proposed retail outlets,” the ministry said in an October 5 notice. The 2019 order, however ”does not prescribe the order in which the dispensation of conventional fuels (petrol and diesel) and the new generation alternate fuels would be started, i.e. dispensation of biofuels and CNG, EV charging can be started before dispensing of petrol and diesel,” it said.
The new liberalised rule allows any entity with a minimum net worth of Rs 250 crore to apply for authorisation to retail petrol and diesel. Under the November 2019 policy, petrol pump licence has so far been granted to Reliance Industries Ltd, IMC Ltd, Onsite Energy Pvt Ltd, Assam Gas Company, M K Agrotech, RBML Solutions India Ltd and Manas Agro Industries and Infrastructure.
RIL already had a fuel retailing licence, under which it had set up over 1,400 petrol pumps in the country. But this licence was transferred to its subsidiary Reliance BP Mobility (RBML). And so, billionaire Mukesh Ambani’s firm applied and got another licence.
A separate joint venture of the firm with BP, called RBML Solutions India Ltd too has got a licence. It isn’t clear if RIL and RBML Solutions will set up separate, competing for petrol pumps.
Besides doing away with the earlier requirement of investing Rs 2,000 crore in the oil and gas sector to be eligible for a fuel retailing licence, the new liberalised petrol pump norms require licensees to set up a minimum of 100 outlets with at least 5 percent of them in remote areas. The licensee is required to ”install facilities for marketing at least one new generation alternate fuels like compressed natural gas (CNG), biofuels, liquefied natural gas, electric vehicle charging points etc at their proposed retail outlets within three years of operationalisation of the said outlet.” It fixes Rs 250 crore as the minimum net worth for obtaining the licence.
State-owned oil marketing companies — Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) — currently own most of the 78,751 petrol pumps in the country. RBML, Nayara Energy (formerly Essar Oil) and Royal Dutch Shell are the private players in the market but with limited presence. RBML has 1,427 outlets, Nayara 6,250 while Shell has just 285 pumps.
BP had a few years back secured a licence to set up 3,500 pumps but has not yet started doing so. It has since decided to venture into the business with RIL with plans to scale up RIL’s present network strength to 5,500. Those granted licences include Chennai-based IMC (once called Indian Molasses Company), which specialises in oil terminals, and Assam government firm, Assam Gas Company.
Assam Gas Company is in the business of gas transportation. Not much is known about Onsite Energy which was incorporated in May 2020.
M K Agrotech is part of a diversified conglomerate with interests across agricultural products such as sunflower oil, real estate, and crude oil and gas extraction, while Manas Agro Industries and Infrastructure has its own brand of Liquefied Petroleum Gas (LPG or cooking gas).
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