SHV Holdings NV is a Fortune 500, $10bln, privately owned, Dutch multinational operating in FMCG warehousing, metal recycling, natural gas exploration, venture capital and LPG.
The SHV Gas division operates in the LPG distribution business in most European countries, South America and Asia with global sales in excess of 7 million tons.
In developing countries such as Pakistan, it specialises in providing cheap, alternative energy to remote areas to replace wood, kerosene and biogas used for cooking.
SHV entered the Pakistani market in 1998. Its market share is over 18% and is the largest LPG marketing company selling over 70,000 ton per annum of gas to the rural areas.
SHV has the largest LPG infrastructure in Pakistan with seven bottling plants and transport capacity to move over 600 Mt/day to enable their 500 distributors to cater to the needs of the community.
To cope with the anticipated expansion of the business in 2004 to 80,000 tons per annum, SHV is investing $6 million in locally manufactured storage vessels and cylinders; all built to international safety standards.
In addition, SHV has invested in small bottling plants and storage depots in Muzaffarabad, Gilgit, Swat, Chichawatni and Quetta.
The depot in Muzaffarabad has been operational since 15th March 2003 and provides unlimited supplies of gas to rural communities in AJK. Because these depots are operated by SHV itself, retail prices are controlled to ensure affordability to the consumer.
In 2000, SHV introduced the concept of bulk LPG supplies for small industrial and commercial use.
In this new market, SHV supply storage tanks at the correct size for the installation and the fuel is supplied directly from the refinery to the customer by special road tankers.
The consumption is computerised so that deliveries are made automatically to the customer, guaranteeing continuous supplies.
This business is supported by the extensive global experience of SHV in bulk technology and marketing.
Supplies of LPG are obtained from PARCO, who supply 25% of their production to SHV, which is marketed under the brand name of Pearl Gas to rural communities. OGDCL at Dodak, OPI at Dhurnal supply the remainder of the locally produced produce, which is augmented by imports through the 4500 ton LPG sea terminal at Karachi.
SHV is predominately a LPG down-stream marketing company but to guarantee supplies up-stream investments have been made in sea terminals throughout the world.
To further secure local supply sources and price competitiveness in Pakistan, SHV is now embarking upon a strategy of investing in up-stream natural gas separator plants.
The demand in Pakistan is 450,000 tons with 400,000 tons being supplied from local sources, the remainder being imported.
The total market is 1,000,000 tons. The cost to produce this additional tonnage of 550,000 tons from local sources (mainly natural gas separators) is in the region of $75 million investment capital.
The cost of the down-stream infrastructure (bottles, filling plants, road tankers, storage tanks etc) is about $110 million.
To this should be added the marketing infrastructure cost, making a total investment approaching $200 million. This potential would be realised over a seven-year time span.
SHV has both the financial resources and the marketing expertise to realise this full potential.
(The SHV business in Brazil, at some 2 million tons per annum, is double the potential market in Pakistan).
For further information on the above please contact Mr Patrick Gregory, Chief Executive Officer, SHV Energy (Pvt) Ltd, 98 Margalla Road, Islamabad, Pakistan.
Tel: 0092 (0) 51 2274400 email [email protected]
(CEO SHV Energy (Pvt) Limited)
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