Fewer fuel stations for inner Bangkok

[Admin]

Fewer fuel stations for inner Bangkok 
The Nation: 28 Sep 2010
Fewer fuel stations expected in inner BKK areas
By The Nation
Published on September 28, 2010

Fewer fuel stations will operate in the inner city areas, due to high land prices and strict regulations, said energy expert Manoon Siriwan who said there are fewer than 100 stations in the areas now from nearly 200 years ago.

He estimated that it requires Bt100 million to invest in a station, against low margin in the retail oil market. Many of fuel stations in the inner areas are 20-30 years old, and they have to renew land lease contracts. To have the contracts renewed, they are asked to pay Bt50-Bt60 million in fee and spend another Bt50-Bt60 million for the construction.

Moreover, the business faces restrictions. They are barred from standing on the roads with less than 7 metres in width. They are not allowed near hospitals or schools.

"While old stations are closed, it would be difficult to invest in new ones," he said. "Consumers will need to make a better plan in refilling tanks."

The Energy Business Department data showed that the number of fuel stations in Bangkok has been declining during the period 2006 and 2010. From 911 stations in 2006, the number fell to 882 in 2007, 896 in 2008 and 891 in 2009. Bangkok is now home to 875 stations as of June this year.

Chakkrit Charuchinda, vice president for strategic retail marketing of PTT, said that this year PTT has shut down a few stations in the inner Bangkok areas. The rest are part of public premises, as land rental price could be as high as Bt100,000 per square wah per year. The lease period is also as short as 3 years. This leads to some business risks, he said.