We offer the convenience of a single account to cover all of your bulk lubricant and fuel needs. An InterOil account offers simple, easy to read invoices and statements, and a dedicated team of sales staff to assist you.
In addition, using the same application form you can apply to have an InterOil Card account that allows your vehicle fleet access to our National network of InterOil Retail Service Stations and our latest fleet control reporting with full odometer and GST itemisation.
As of December 31, 2011, we provided petroleum products to 52 retail service stations with 42 operating under the InterOil brand name and the remaining 10 operating under their own independent brand. Of the 52 service stations that we supply, 16 are either owned by or head leased to us, which we then sublease to company-approved operators. The remaining 36 service stations are independently owned and operated. Three new retail sites were identified and we expect to develop these sites during the 2012 and 2013 financial years.
We supply products to each of these service stations pursuant to distribution supply agreements. We also provide fuel pumps and related infrastructure to the operators of the majority of these retail service stations that are not owned or leased by us under cover of equipment loan agreement.
In 2009, we entered into our first direct chartering shipping arrangement with the owner of a fuel transport vessel which resulted in us being able to direct vessel movements rather than co-ordinate shipping with other distributors. During 2010, a second vessel was directly chartered and we now directly manage all our sea freight movements of fuel within Papua New Guinea. Increased demand for fuel has led to our planning for the chartering of a larger vessel during 2012, to replace the second vessel chartered in 2010.
In November 2010, the ICCC completed its review of the pricing arrangements for petroleum products in PNG. The purpose of the review was to consider the extent to which the existing regulation of price setting arrangements at both wholesale and retail levels should continue, or be revised for the five year period ending at the end of 2014. The report recommended an increase in margins for wholesaling and certain other activities while the retail margin is to remain the same. It also recommended some increases in monitoring industry activity in PNG. All recommendations were implemented in 2011.
In 2011, we signed supply agreements with several key contractors and sub-contractors associated with the Exxon Mobil LNG project, Papua New Guinea’s largest resource project in its history to date. In addition, we re-signed supply agreements with all of our existing major customers in the agricultural, commercial and aviation sectors for further three year terms.
Our retail business accounted for approximately 13% of our total downstream sales in 2011. Investments were made in 2010 and 2011 in new electronic systems for both pumps and the forecourt control units to support the further development of this business.