WGI plans to enter fuel retail market

PT Wiraswasta Gemilang Indonesia (WGI), the sole distributor of Pennzoil lubricant in Indonesia, has applied for a license from the ministry of energy and mineral resources to enter the country’s growing fuel retail market, Investor Daily reported on Thursday.

Ari Batubara, the president director of the company, confirmed on Wednesday that the company was waiting for the issuance of the government’s license to enter the fuel retail market.

“We have applied for the government’s permit to tap the fuel retail market. It’s quite attractive,” he said, but he refused to go into detail. According to him a feasibility study is now underway to ensure if the business is economically viable for the company.

He said that the company was still considering whether it should import or not in procuring the fuel. However, the distribution and storage facilities will not really pose a problem for WGI in distributing the fuel. For the initial stage, WGI can use its existing facilities to carry out the business.

At present, WGI has two storage facilities in Jakarta and Surabaya, respectively with a capacity of 9,000 kiloliters and 5,000 kiloliters, in addition to about 40 fuel trucks.

Pertamina’s exclusive rights to distribute and sell fuel in the country will be fully removed in January, next year as part of the liberalization of the country’s fuel market. A number of major oil companies including Shell and Petronas have obtained the government to enter the fuel retail market. They have even built their own networks including fuel stations to carry out the retail business. (*)