BP and Shandong Dongming Petrochemical Group (Dongming Petrochemical) announced the signing of joint venture agreements to develop a leading branded retail fuels and convenience business covering the Chinese provinces of Shandong, Henan and Hebei.
Subject to regulatory approvals, the partnership with Dongming Petrochemical will start operations in 2018 and the network is expected to grow to 500 sites in 10 years. BP has a 49% equity share of the joint venture and Dongming Petrochemical the remaining 51%.
“New market growth is one of the key strategic priorities for BP’s fuels marketing business. Our retail business offers customers a differentiated experience through our brand, high-quality products and services,” said Tufan Erginbilgic, BP’s chief executive for Downstream.
“This joint venture plans to create a modern retail fuelling network, delivering high-quality customer experiences and contributing to a safer, cleaner and more efficient industry in China. Building our retail presence in China supports our goal to grow our earnings in the Downstream.”
BP already has over 740 retail sites in China through existing joint ventures. Today’s agreement is part of a focused growth strategy that will see BP continue to expand its retail presence in China through both new and existing partnerships, bringing its leading offer to customers across the country.
“China offers exciting opportunities for growth for the BP group,” Dev Sanyal, BP’s executive vice president regions, including Asia, commented. “Dongming Petrochemical are a strong local partner and we are pleased to be working with them to expand our footprint into Shangdong, Henan and Hebei, which are among the fastest-growing Chinese provinces.”
“I believe our strategic partnership will further promote the in-depth reform of the retail sector in China,” Xiangping Li, Chairman of Dongming Petrochemical, commented: “I also look forward to a sound development of mutual benefit and complementary advantages.”
BP currently operates more than 740 dual-branded retail stations in Guangdong and Zhejiang provinces with partners China National Petroleum Corporation (CNPC) and China Petroleum & Chemical Corporation (Sinopec) respectively. Across this network BP serves 400,000 customers and sells over 12 million litres of gasoline and diesel every day.