The Ministry of petroleum and Natural Gas has simplified the guidelines for grant of authorisation for bulk and retail marketing of motor spirit (petrol) and high speed diesel (diesel). 

 

The simplified guidelines aim at increasing private sector participation in the marketing of petrol and diesel. An entity desirous of seeking authorisation for either retail or bulk must have a minimum net worth of Rs. 250 crore at the time of making an application and Rs. 500 crore in case of authorisation for both retail and bulk.  

 

Bulk business is when an entity supplies product directly in bulk (minimum one full truck load of ordinarily 12,000 litres per delivery) to end users (for their own consumption and not for resale) and/or to other entities who have obtained marketing authorisation (for selling in either retail or bulk or both).

 

Applications may be submitted in the prescribed application form directly to the ministry. For retail authorization, the entity is required to set up at least 100 retail outlets. The policy has opened up the marketing sector of petroleum products by removing the strict conditions applicable earlier. The policy has the potential to revolutionise marketing of transport fuels in the country. Retail business is when an entity sells products through the dispensing units installed in the retail outlets.

 

In addition to conventional fuels, the authorised entities are required to install facilities for marketing at least one new generation alternate fuels like Compressed Natural Gas (CNG), biofuels, Liquefied Natural Gas (LNG), electric vehicle charging points etc. at their proposed retail outlets within three years of operationalisation of the said outlet subject to the entity complying with various other statutory guidelines (of Petroleum and Natural Gas Regulatory Board, Central Electricity Authority, Petroleum and Explosives Safety Organisation, etc. as applicable). 

 

There shall not be any restriction on an authorised entity utilising the same retail outlet premises for sales of other new generation transportation fuels by other companies subject to it complying with all statutory guidelines as applicable.

 

The entity seeking authorisation for retail marketing shall make an application to the government in the prescribed manner along with the requisite non-refundable application fee of Rs. 25 lakh. The entity needs to set up at least hundred retail outlets, out of which at least 5% of the proposed retail outlets shall be set up in the notified remote areas within five years of grant of authorisation as per timelines indicated. 

 

The issue of resolution for grant of authorisation for bulk and retail marketing of petrol and diesel will liberalise the guidelines to increase private sector participation, including foreign players in the marketing of petrol and diesel. It will also encourage dispensing of alternate fuels and augmentation of the retail network in remote areas and ensure higher levels of customer service.