Companies to run gas stations

The Ministry of Municipal and Rural Affairs is considering transferring the management of all gas stations from individuals to companies.
This will be done in cooperation with gas companies, according to Riyadh Al-Malik, president of the National Committee of Gas Stations at the Saudi Council of Chambers of Commerce.
Al-Malik said that around 10 local companies would be managing the stations, in addition to opening the door to foreign companies.
“The Ministry of Municipal and Rural Affairs will stipulate several requirements, such as corporate identity, experience and financial capacity. Such a step will help raise the country's gross domestic product (GDP). The current gas station situation is harming the economy since all profits go to individual owners and expats,” he added. “Furthermore, the current gas station market is considered the best environment for money-laundering,” he alleged.
He said that expatriates who are not under the sponsorship of the station’s owners currently manage 90 percent of all gas stations in Saudi Arabia. A source told Arab News that illegal expats, too, are working in gas stations that are managed by companies due to the low number of visas that the Labor Ministry has issued for gas companies.
According to him, specialized companies operate only 10 percent of gas stations across the Kingdom due to the absence of a law to organize this sector.
“The majority of gas stations are expected to be shut down very soon as they lack legal staff. The gas stations will face a crisis, as workers at gas stations would not be able to change their situation and gas station owners would not be able to hire new workers due to the limited number of visas,” he said.
He added: “Saudizing the gas station sector is another problem that companies are facing, since the work environment is not attractive for Saudis. As per the Nitaqat system, gas companies need to achieve a rate of 13.5 percent to be placed in the green category. Achieving such a percentage is not feasible, so there are plans for the Labor Ministry to reduce the rate.”
He said the Council of Ministers recently asked the Ministry of Municipal and Rural Affairs to prepare a plan to improve the situation of the gas stations within six months, which includes managing all gas stations through gas companies.
Al-Malik said that in neighboring countries, gas stations are managed by companies. “Here, the situation is atypical. For example, we see such promos as ‘Purchase gasoline worth SR 10 and get two bottles of water for free.’ Since gasoline prices are fixed by the government, what is the need for such offers?” he asked.
He added: “Such offers indicate that gasoline is not the quality that the customer is looking for. There is an absence of control on gas stations, which is why the customer cannot be sure of the quality of the gasoline or the credibility of the gasoline meter.”
Samir Nawar, CEO of Petromin, said that as individual investments have taken major control of the gas station business in Saudi Arabia, gas companies will now manage all stations across the Kingdom within two years.
“The recent move by the Labor Ministry to stop expats from working without their sponsors will leave a huge impact on the gas station market. We are expecting many gas stations to shut down very soon or to try to find new operators who are legal,” he said.
He added that in Saudi Arabia, one finds the lowest level of service in gas stations because of the domination of expat workers who run it in a primitive way.,“They care only about the profits regardless of the quality of service. They also lack skills,” he said.