Monday, Nov 26, 2012

(This article was originally published Sunday.)

By Hassan Hafidh

The Jordanian government has awarded France's Total SA (TOT) and Jordan's Manaseer Group licenses for fuel distribution in the country, a move that will take it one step closer to liberalizing its fuel market.

Last week, a government decision to increase fuel prices, including household gas, by up to 53% sparked a series of protests in a country that imports almost all the energy it consumes.

Total and Manaseer have become the country's first private sector fuel suppliers--until now Jordan Petroleum Refinery Co. has been the country's sole distributor.

Under the agreements, Total and Manaseer will supply oil derivatives to the country's 450 fuel stations along with the JPRC, Minister of Energy Alaa Batayneh said in a statement.

The agreements are part of the government's efforts to move the country towards a liberalized fuel market providing "the best price" to citizens, Mr. Batayneh said.

"Total Jordan strives to play a key role in supporting the development process in the Kingdom, therefore, we believe that with this license we have taken a major step forward in capturing growth opportunities and consolidating the development of the Total brand in Jordan," said Mehmet Celepoglu, managing director of Total Jordan.

Under the licenses, approved in September, each firm will serve as the exclusive fuel supplier to a third of the country's fuel stations for a three-year period. Total and Manaseer will buy the fuel from JPRC and sell it to fuel stations and industrial companies in Jordan.

The new licenses allow only for local distribution of fuel and excludes oil refining processes and the importing of refined fuel products, which is handled exclusively by the JPRC.

Jordan sole refinery, located 25 kilometers north of Amman, refines 75% of the Jordan's oil product needs, with the government meeting the remainder from imports.

Jordan, home to about 6 million people, currently imports some 96% of its energy needs and consumes a little over 100,000 barrels a day.

Write to Hassan Hafidh at hassan.hafidh@dowjones.com

(END) Dow Jones Newswires

26-11-12 0343GMT