New Delhi, May 12: The petroleum ministry has cleared a proposal to allow global major Shell to sell petrol and diesel at the retail level in the country.
The company, however, will have to furnish a bank guarantee of Rs 500 crore to the government to fulfil the commitment to invest Rs 2,000 crore in building infrastructure in the country’s hydrocarbon sector.
Shell will have to sign an agreement with the government indicating the year-wise milestones of its investment schedule. The company will also be required to set up 11 per cent retail outlets in remote areas.
Shell has drawn up a plan to set up around 2,000 retail outlets spread across the country. The company has also informed the ministry that domestic refineries would be the preferred sources of supplies for their retail operations.
Shell has also stated that it would prefer to make use of the nation-wide installations and depots of public sector oil companies.
The public sector oil companies are operating 19,500 petrol and diesel retail outlets in the country.
The government has already granted marketing rights for transportation fuels to Reliance Industries which intends to set up 5,849 retail outlets, Essar Oil for 1,700 filling stations.
Upstream oil major ONGC will put up 600 stations and the Numaligarh refinery 510 stations.
Both Shell and Reliance are in the race for taking over the lucrative Hindustan Petroleum Corporation Ltd (HPCL) which the government has put up for sale.