The Hindu Business Line : MRPL to roll out retail plans

Notable fixtures
The Indian crude basket is fluctuating in the range of $55-$58 a barrel
The sales revenue from petrol and diesel combined is expected to turn positive

New Delhi , Nov. 19

With the retail margins in petrol and diesel turning positive, Mangalore Refinery and Petrochemicals Ltd (MRPL), a subsidiary of ONGC, has decided to move ahead with its plans to roll out retail outlets albeit cautiously.

MRPL, which has the marketing rights to set up 500 retail outlets, plans to roll out 25 by next year. With its brand HiQ, it would initially concentrate in the South starting from Mangalore.

Earlier this year, the Petroleum Ministry had asked MRPL to go slow on its retail plans as the business was not lucrative with high under-realisations on sale of both products due to scaling international crude prices. After considering the Government suggestion to revisit its foray into the retail business, MRPL had decided to go slow.

With the Indian crude basket fluctuating in the range of $55-$58 a barrel, the sales revenue from petrol and diesel combined is expected to turn positive. Currently, State-owned oil marketing companies are suffering an under-realisation of 40 paise per litre on sale of diesel and over-realisation (profit) of Rs 4.50 per litre on petrol.

Since the retailing business in the petroleum sector was opened up from April 1, 2002, the Ministry has granted marketing rights to Reliance Industries Ltd for close to 5,849 outlets, Essar Oil (initially 1,700 outlets), Shell (2,000), ONGC (1,100), MRPL (500), and Numaligarh Refinery Ltd (510).

As regards plans for OVal, ONGC's retail brand, the executive said, the company wanted to go slow on the retail front. Only 4-5 OVal outlets are likely to be set up, he said adding, "The retail outlets would be restricted to areas where it has already got sites." At present, one OVal outlet has been operationalised, while none from MRPL stable has been set up.

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