British energy company BP Plc opened its first branded station in Shandong, East China in January, the latest move of global energy giants investing in gas stations after China lifted restrictions on foreign investments in the sector in June 2018.
The new site is the start of BP’s plan to add 1,000 new sites across China over the next five years through its joint venture partnership with Shandong Dongming Petrochemical Group, a private refiner. Half of the new sites will be in Shandong, Central China’s Henan and North China’s Hebei provinces, a result of its joint venture with Dongming Petrochemical, which was formed last February.
The new location will also be BP’s first retail site in the country to offer fast charging for electric vehicles, it said.
The policy change is part of the National Development and Reform Commission and the Ministry of Commerce’s new “negative list” introduced last year, which removed restrictions in various sectors including banking, automobiles, commodities and agriculture.
“We want to offer our Chinese customers a friendly and welcoming experience,” said Hanna Hofer, president of BP China Retail.
“In this site, we are testing a new design and service offer, reflecting the uniqueness of the fast-changing retail environment and customer needs in China.”
In addition to BP, many other international oil and gas giants have also expressed keenness in investing in the country’s fuel retailing industry, eyeing a slice of the pie from China’s 100,000-station gasoline retail sector, including Royal Dutch Shell Plc, which said earlier it would triple the number of gas stations it has in the country to 3,500 by 2025.
According to Fernando Vallina, chairman of ExxonMobil (China) Investment Co Ltd, though the company has no plans for setting up more gas stations in China, lifting the 30-site limit for international fuel retailers will definitely provide more opportunities for the company.
Insiders believe while foreign players’ share is expected to see an increase in the upcoming years, especially a higher market share providing high-end products and value-added services, the fuel retailing sector in the country, which is currently dominated by State-owned oil and gas majors, would still remain unchanged in the short term.