Trends Indicate Maturity in the Gas Station Sector
Home > Oil & Gas > News Article

Trends Indicate Maturity in the Gas Station Sector

Photo by:   Pixabay.com
Share it!
Perla Velasco By Perla Velasco | Journalist and Industry Analyst - Thu, 12/08/2022 - 09:55

According to Jorge Mijares, President, National Organization of Petroleum Distributors (ONEXPO), changes in the type and number of companies that manage gas stations indicate maturity in the industry and the development of a freer market. He also pointed out that while contracts used to be leased for 15 years, it is expected that now they will last only one year.

Regarding TotalEnergies recent exit from the market, Roberto Díaz de León, Adviser, ONEXPO, said the company will stay in the country and will only abandon management. Díaz also added that CRE’s recent permit approvals could incentivize new investment in the market. “With more than 400 permits recently issued, the spirit of the sector has renewed and we will surely see new business models for building and developing service stations,” said Díaz.

After the energy reform of 2014, PEMEX lost many of its gas stations. The NOC presented a plan to recover part of the supply market and now it controls 85 percent of the fuel supply in Mexico. According to ONEXPO, many service stations returned to work with PEMEX during 1H22. The companies that lost the most stations to the NOC were Gulf Oil (29), BP (23) and TotalEnergies (34). Despite Mijares’ projections, some private players remain skeptical about the state of the market, since different problems with Mexican policies have stagnated sizeable investments.

Still, according to Díaz, the sale of gasoline will increase by 5 percent next year, with PEMEX increasing its value offering. Días added that this will create more investment, as it is estimated that each gas station requires a yearly investment of around MX$600,000 (US$30,515). 

Díaz advised on the possible negative impact of the new General Administrative Provisions for hydrocarbons (DAC), which stipulate that distributors and sellers must follow a market study, a business plan and must justify the reasons for not reaching their sales goals, should that be the case. Díaz exposed that these provisions do not add value but rather workload for the fuel chain value. “We believe that these operations will add a very significant administrative burden. That administrative burden is going to be reflected in cost and that, in the end, will impact the consumer,” he said.

Photo by:   Pixabay.com

You May Like

Most popular

Newsletter