ENOC continues diversification

ENOC chief executive says a move into retailing isn't related to losses at the pumps, but he renewed calls for the removal of government price caps on petrol.

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By  David Ingham Published  January 31, 2001

Emirates National Oil Company today opened the first of what could become a major chain of convenience shops across the Emirates.

Hussain Sultan, chief executive, said he was as excited about the opening as he was about the first EPPCO station, but he claimed that the diversification into retail was nothing to do with ENOC’s huge losses at the pumps.

“This is something we’ve planned for a long time,” said Sultan. “It’s not because of the losses.”

Nevertheless, he was outspoken on the need for the authorities to reconsider price caps on petrol sold at the pump. ENOC is currently in a bizarre situation where it buys oil at market rates and then has to resell it at lower, government dictated prices at petrol stations.

“We’ve been losing heavily for the last eighteen months – that’s no secret,” said Sultan.

“I’ve taken it up with everybody – Sheikh Hamdan, the ministers,” he continued. “It’s a very difficult question, I know, but I don’t think subsidies are a good idea. You have to have the market price for a commodity.”

The new convenience store, which carries the name Aqua, is located in downtown Bur Dubai. Sultan said ENOC is likely to open five of the outlets this year and that long term it’s looking at establishing outlets across the whole of the Emirates.

Plans to expand the chain of ENOC petrol stations, he added, were temporarily on hold, because of the losses on pump petrol.

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