All Way Petroleum Plc is going to join the petroleum distribution business of Ethiopia on Monday, March 9, 2015. Upon joining the market the company is going to be the 10th petroleum distributer in the economy.
The company is owned by Sisay Woldyes, who is among the 100 dealers that work with Yetebaberu Beherawi Petroleum (YPB). He established the company at an authorized capital of 30 million Birr.
According to Sisay, it was back in July 2014 that the company secured a license from the Ministry of Trade (MoT) and it will commence rendering service on Monday, March 9, 2015.
The company has its depot at Adama, Oromia State. The depot lies on a 20,000 square meters plot of land and has 16 depots each with a capacity of 50,000 liters. The depots are going to be used for benzene, diesel and kerosene.
Commenting on the development, Desalegn Alemayehu, General Manager of All Way, said, “We are registering dealers who are going to work with us.”
State Minister for trade, Ali Siraj, noted the government encourages new distributors. He compared Kenya who has 30 distributors while Ethiopia currently has only nine. “As the sector demands huge investment, local companies are not motivated to join the sector,” he said. “To encourage new entrants into the sector, the government is working on the possibility that the private investors can work with foreign companies through joint venture.”
Out of the nine companies that are currently operating in Ethiopia, 90.4 percent of petroleum distribution is done by four companies; National Oil Company (NOC), Oil Libya, Total and YBP. The rest is covered by the other five; Dalol Oil, Kobil, Wadi Al Sundus, Nile Petroleum and TAF Oil S.C
These nine companies distributed a total of 2.6 million tons of fuel that was worth 48.9 billion Birr in the year 2013/2014. Of the total amount, 207,819 tons was benzene, worth 4.2 billion Birr, 256,739 tons of kerosene worth 5.2 billion Birr, 1.7 million tons of diesel worth 32 billion Birr.
During the first half of the current fiscal year a total of 1.3 million tons of fuel was distributed in the market. 33 percent of this was done by NOC and Total took 23.1 percent of the share. Oil Libya and Nile accounted 22 percent and 0.84 percent of the market share respectively.
Until 2002 when NOC and YBP joined the Ethiopian fuel distribution market, it was dominated by longstanding companies. Prior to this point only four suppliers; Mobil, Agip, Shell and Total were operating in the country for over three decades.
Source: Fortune
