The Hindu Business Line : Shell India stops retailing normal grade fuel at all outlets

Bangalore, March 17 Facing huge losses, Shell India Marketing has stopped selling main grade petrol and diesel fuel at all its 50 fuel retail stations, but has petitioned to the oil regulator seeking a level playing field with its counterparts in the public sector.

Shell Marketing, however, continues to retail premium fuel across all its outlets. Shell India Marketing Pvt Ltd Managing Director, Mr Surinderdeep Singh, told newspersons at the sidelines of an event which was organised on the occasion of Ferrari 612 Scagilettis’ 11-week ‘Magic India discovery’ tour, that the Ministry of Petroleum and Natural Gas Regulatory Board has called for a meeting of all the oil PSUs, the Government as well as the private players to discuss the matter.

Mr Singh said while oil PSUs get reimbursed from the Government for losses incurred because of selling petrol and diesel at lower rates than the market rates, private players do not get the same benefit. He said for 2007-08, the Government’s oil subsidy bill for the oil PSUs was as high as $18 billion.

Mr Singh pointed out that for getting a licence to retail fuel, Shell, as per the norms laid down by the Government, had invested about Rs 2,000 crore in qualifying assets. In accordance with the Government norms, Shell had set up a Hazira-LNG plant in Gujarat at an investment of Rs 2,000 crore.

“In spite of following all the norms, the Government continues to discriminate against us when it comes to subsidies,” Mr Singh said.

He said after Shell stopped retailing normal grade fuel at its petrol stations, its market share had reduced considerably. “If we had continued to sell normal grade fuel, our losses would have increased substantially,” he added. Shell buys most of its requirements from Mangalore Refinery.

Shell now sells premium fuels such as Shell Super unleaded petrol and Shell Diesel extra with additives which are imported from European countries. Shell has a licence to set up 2,000 retail outlets, and has so far set up 50 of them, with most of them located in the South.

Ferrari, with whom Shell has a technical tie-up, is navigating India as part of a tour to expand its brand beyond its traditional fan base.