Sinopec and Shell to establish joint venture for 500 gas stations

Wang Jiming, the president of China Petroleum & Chemical Corporation (Sinopec), says in Shanghai that Sinopec will establish a joint venture with Shell Petrochemicals to deal in the 500 gas stations in Jiangsu.
Wang says that China's petrochemicals are faced with austere challenges such as the relative lack in crude oil, the uncertain factors affecting the base oil price, the drastic competition and so on. However, Wang also says that Sinopec's retail has increased from 35.4 % of 2000 to 51.2 % in 2003 and its market share has increased from 63 % to 76 %.

Wang Jiming discloses that the Sinopec and Shell's feasibility report to establish gas stations has been approved by the State Council. At present, the two sides are discussing about the contract items on the joint venture.
Once the project is approved by the Ministry of Commerce, Sinopec will invest $ 200 mm to 300 mm to establish the joint venture with Shell. Sinopec will take 60 % of the stake, and Shell will take 40 % of the share. And the joint venture will be established within 2004, Wang says.