Byco Petroleum Pakistan (BPP) intends to join the league of top three oil marketing companies in Pakistan and, to achieve that position, the company has the plans to explore different suitable and commercially viable acquisition options in the country.
"Two years back we were ranked 10th or 11th in the league of oil marketing companies but now we are ranked 6th while we are working on different options which would soon ensure 5th position for Byco in the industry", Kalim A Siddiqui, President of Petroleum Marketing Business, BPPL said.
Talking to Business Recorder, he said that currently the company has a network of 202 stations in all four provinces and in Gilgit-Baltistan and Azad Kashmir and if everything goes fine, it would have a network of 250 stations by June 2011. "We also plan to add 100 more retail stations in year 2012", he added.
"This we are talking about organic growth only," Kalim said and added that "it's part of our strategy to explore the options of acquisitions since we need to have a large retail network ready for the time our new refinery with the capacity of 120,000 barrels a day is operational."
He said: "We want to capitalise the optimum benefits of the availability of quality refined products through which the company can ensure good profits in the long run".
Kalim said the company wants to achieve a position among top three players in the industry. "Organic growth would take time; hence, we are keeping our options open for acquisitions, too", he said.
The current capacity of refinery is 36,000 barrels a day, while the new refinery, with the capacity of 120,000 barrel a day ,would be operational in calendar year 2011 and, with a cumulative 156,000 barrels a day refining capacity, Byco petroleum would become the country's largest refinery, Kalim said.
He said that overall market share of petroleum marketing business (PMB) of Byco in petrol, diesel and furnace oil has jumped from 0.7 percent to 2.7 percent. "We are pursuing a robust growth strategy with aggressive network expansion and innovative marketing strategy which has resulted in improvement in our market share", he added.
The company is launching fully loaded mobile quality vans to check quality and quantity of petroleum products at its outlets. These mobile teams would pay surprise visits to ensure best services and would also keep a check on its franchisees, he said.
The company has started its terminal in Keamari and now it is the 4th oil company to have this terminal facility in Keamari. This is connected for imports with its jetty and the first jet fuel cargo has also arrived. Currently, the ready capacity of this terminal is 11,700 tons but the company is working to further increase its capacity.
Kalim said that the industry had been neglected at large by the government. The margins of refineries, oil marketing companies and dealers have been reduced drastically due to which petroleum refining and marketing is not such an attractive investment option any more.
He said that the government should deregulate the oil sector and let the industry players define the prices according to their input costs. This healthy competition among the OMCs would ensure further improvement in quality of products and services and the common man would benefit as he would have different options.
"The government should allow refineries and oil companies to set the prices, and the government should just regulate and monitor them to ensure that no cartel takes place and no undue profiteering takes place", he said, adding that the monthly price change of oil products and prior media leaks and stories should be curtailed, which is promoting hoardings at petrol stations.
Due to expected rise in the prices, the petrol stations do hoarding and sell it at increased price, he said. The unnecessary speculations also cause the difficulties to oil companies as their management of reserves is affected by this speculative activity and increased demand in last week of every month, he added.
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