In Dakar, the fierce competition for gas stations
1 April 2015
Read by 5134 persons
It seems every street in Dakar dreams of having its own. A few weeks ago, a gas station was inaugurated with great fanfare on Habib Bourguiba Avenue. Less than a kilometer away, near Cheikh Ahmadou Bamba Avenue, there were already two others. Further on, on the Route du Front de terre leading to Hann, upstream from the Batrain neighborhood bordering the Senghor airport runway, other gas stations are constantly busy. The same is true in the chic Ngor-Almadies area. Running out of gas in Dakar today? "Impossible," answer the inhabitants of the capital.
According to the Ministry of Energy, there are a little over 500 gas stations in Senegal, with a large majority concentrated in Dakar and its surroundings. Total Senegal, the main player with 55% of the market, claims a network of 175 "gas stations" on land. Then come Shell-VivoEnergy, Oilibya which took over Mobil, Oryx Energies, the local "major" Elton... Not to mention all those small foreign and especially local companies.
To explain this sudden surge in gas stations in the Senegalese capital, experts and officials in the sector put forward several factors. First, there is a financial stake with a "piece of the pie" estimated at around 1,000 billion CFA francs (around 1.5 billion euros). "For reasons of volume and visibility, the presence of oil companies in Dakar is fundamental," says Ameth Guissé, president of the Senegalese Association of Petroleum Companies (ASP), which brings together the main local companies.
Steady growth of the vehicle fleet
Dakar, which covers only 0.3% of Senegalese territory, alone accounts for 70% of the national fuel volume. This is estimated at around 2 billion liters per year. "This is the main reason why oil companies are mainly trying to establish themselves in Dakar, even though, with the construction of new roads in the country, there are volumes that are also becoming interesting elsewhere," stresses Ameth Guissé.
The surge in gas stations in Dakar is also linked to the attractiveness of the Senegalese market, characterized by steady growth in the vehicle fleet, a constant increase in population and quality road infrastructure. But for Thibault Flichy, managing director of Total Senegal, this attractiveness has its limits because "pump prices are regulated by the state [via the National Hydrocarbons Committee], and distributor margins are among the lowest in Africa."
"Margins are not elastic, but they are affected by economies of scale: the more liters of fuel you sell, the more you earn," acknowledges Ameth Guissé. On February 22, the distributor margin increased from 59.60 francs to 61.6 francs CFA per liter, while the retailer margin jumped from 10.5 francs to 14.5 francs per liter.
"A gas station near every Senegalese person"
But the big winner remains Total Senegal. "Our policy is simple: we are looking for a proximity network to allow every Senegalese person to find a Total station near their home," emphasizes the brand's managing director. We want to be positioned on high-traffic axes and with high market potential, while remaining consistent and homogeneous with respect to the overall network."
It remains to be seen whether the rules for opening gas stations, which are theoretically restrictive, are being respected. The populations around Hann Bay, in the greater Dakar suburbs, recently expressed their concerns about the proliferation of these stations.
But in times of scarcity, town halls are increasingly welcoming new gas stations. According to Ibrahima Seck, municipal secretary of the Fann-Point E-Amitié district council, the taxes paid by the stations located in his territory bring in 6 to 7 million CFA francs (between 9,200 and 10,600 euros) each year.
lemonde.fr
According to the Ministry of Energy, there are a little over 500 gas stations in Senegal, with a large majority concentrated in Dakar and its surroundings. Total Senegal, the main player with 55% of the market, claims a network of 175 "gas stations" on land. Then come Shell-VivoEnergy, Oilibya which took over Mobil, Oryx Energies, the local "major" Elton... Not to mention all those small foreign and especially local companies.
To explain this sudden surge in gas stations in the Senegalese capital, experts and officials in the sector put forward several factors. First, there is a financial stake with a "piece of the pie" estimated at around 1,000 billion CFA francs (around 1.5 billion euros). "For reasons of volume and visibility, the presence of oil companies in Dakar is fundamental," says Ameth Guissé, president of the Senegalese Association of Petroleum Companies (ASP), which brings together the main local companies.
Steady growth of the vehicle fleet
Dakar, which covers only 0.3% of Senegalese territory, alone accounts for 70% of the national fuel volume. This is estimated at around 2 billion liters per year. "This is the main reason why oil companies are mainly trying to establish themselves in Dakar, even though, with the construction of new roads in the country, there are volumes that are also becoming interesting elsewhere," stresses Ameth Guissé.
The surge in gas stations in Dakar is also linked to the attractiveness of the Senegalese market, characterized by steady growth in the vehicle fleet, a constant increase in population and quality road infrastructure. But for Thibault Flichy, managing director of Total Senegal, this attractiveness has its limits because "pump prices are regulated by the state [via the National Hydrocarbons Committee], and distributor margins are among the lowest in Africa."
"Margins are not elastic, but they are affected by economies of scale: the more liters of fuel you sell, the more you earn," acknowledges Ameth Guissé. On February 22, the distributor margin increased from 59.60 francs to 61.6 francs CFA per liter, while the retailer margin jumped from 10.5 francs to 14.5 francs per liter.
"A gas station near every Senegalese person"
But the big winner remains Total Senegal. "Our policy is simple: we are looking for a proximity network to allow every Senegalese person to find a Total station near their home," emphasizes the brand's managing director. We want to be positioned on high-traffic axes and with high market potential, while remaining consistent and homogeneous with respect to the overall network."
It remains to be seen whether the rules for opening gas stations, which are theoretically restrictive, are being respected. The populations around Hann Bay, in the greater Dakar suburbs, recently expressed their concerns about the proliferation of these stations.
But in times of scarcity, town halls are increasingly welcoming new gas stations. According to Ibrahima Seck, municipal secretary of the Fann-Point E-Amitié district council, the taxes paid by the stations located in his territory bring in 6 to 7 million CFA francs (between 9,200 and 10,600 euros) each year.
lemonde.fr
