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Underperforming petrol pumps will be handed over to new dealers

Their performance would be reviewed after the stipulated six months and if sales continue to be sluggish, a fresh set of guidance with a new detailed action plan would be provided for a turnaround in next three months.

Written by Amitav Ranjan | New Delhi | Published: February 15, 2017 4:34:05 am
public oil sector, arun jaitley, budget 2017, oil budget. petroleum budget, diesel budget, petrol price, diesel price, private oil sector, BHEl, G V Ramakrishna, Vijay Kelkar, ONGC, oil companies, oil fight, domestic international oil merger, indian express news, india news, business news The original allottees of pumps that are performing poorly because of temporary financial problems or dispute among family members or partners would be given counseling by oil company officers with an action plan for reviving sales in the next six months.

Petrol pumps, which are performing below their potential, will be given nine months to shore up their sales or else, would be taken over and handed to newly appointed dealers.

Petroleum ministry has outlined a “Holiday Scheme” under which pumps — operated under the banner of state-run oil marketing companies (OMCs) — would be appraised every six months and a list prepared to isolate those that are selling less than 50 per cent of the sales target outlined by the OMC.

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The original allottees of pumps that are performing poorly because of temporary financial problems or dispute among family members or partners would be given counseling by oil company officers with an action plan for reviving sales in the next six months.

Their performance would be reviewed after the stipulated six months and if sales continue to be sluggish, a fresh set of guidance with a new detailed action plan would be provided for a turnaround in next three months.

“In case the dealer is not complying with the guidance/action plan suggested and sales continue to be less than the potential after three months of the second meeting, dealer is to be given an option for going on a holiday for two years as per the Holiday Scheme,” says the ministry’s directive to the marketing heads of the OMCs.

“The existing dealer shall be explained the reasons for holiday in writing and the proposed action plan with timelines for restoring/proposed handing over the retail outlet to the original dealer upon overcoming of the financial problems/dispute,” it says. In case the allottee refuses to opt for the scheme, the OMCs — Indian Oil, Bharat Petroleum and Hindustan Petroleum — would have the authority to issue a show cause after a lapse of three months to take “action as deemed fit including termination” of the dealership.

After the petrol pump is taken over by the OMC, its dealership would be handed to newly-appointed “ad hoc dealer” with the exception that the latter’s operation tenure would be for two years instead of fixed one year that is currently handed for running legally disputed sites.

Moreover, the ad-hoc tenure could be extended further “by four months or till such time the retail outlet is divested” if the allottee resigns or does not come forward to take over after the holiday period.

As a respite to allottees put on holiday list, he could reclaim restoration of his ownership of the petrol pump before the end of two years by giving an undertaking to achieve the sales target.

The ministry’s rationale for introducing the new scheme is that the laggard outlets were causing hardships to motorists as well resulting in loss of sales and brand image of the OMCs.

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