Royal Dutch Shell Plc announced on Monday plans to build 100 gas stations in Shaanxi province with its Chinese partners, in a move to expand its oil retail network in the country, state media China Daily reports.
Shell will develop the stations through Shaanxi Yanchang and Shell Petroleum Co Ltd, a joint venture between Shell, Shaanxi Yanchang Petroleum (Group) Co Ltd and Shaanxi Tianli Investment Co Ltd.
Yanchang Petroleum Group has a 46% shareholding in the joint venture, which was established last year. Shaanxi Tianli has 9% and Shell 45%. The company has a registered capital of 330 million yuan.
The joint venture also opened yesterday its 10th gas station in Xi’an, capital of Shaanxi.
Overseas oil companies were allowed to start selling refined oil products in China from Jan 1, 2007. Shell now has over 500 gas stations, mainly in Beijing, Tianjin, Chongqing, Chengdu, Guangdong and Jiangsu.
China reformed the oil pricing system this January, moving it closer to the international level. Analysts said that the new mechanism, which guarantees an appropriate margin for refiners, might help foreign companies accelerate their expansion into the Chinese market.