The head of BP in Poland has announced that the company will continue to expand its presence in the country, with a particular focus on the motorway sector. This is likely to be a shrewd decision; the strong growth in fuel sales in Poland, as well as the large motorway construction projects currently underway, means that the market is full of opportunities for fuel retailers such as BP.

The CEO of BP’s Polish division, BP Polska, has vigorously denied rumors that the fuel retailer is to pull out of the Polish market, a move that would have provided the opportunity for GazpromNieft and Lukoil to purchase BP’s service station network. Instead, BP has reinforced its commitment to growing its footprint in Poland and has stated that it expects its revenues from the area to continue increasing in the future.

BP has announced that it generated revenues of over E2.6 billion (PLN9 billion) in Poland in 2007, with net earnings of E70.5 million (PLN248 million). As a result, BP intends to continue investing in the market. It is especially interested in tendering for commissions to build petrol stations on motorways, as well as developing its coffee shop chain, which currently has 112 outlets.

Poland has a number of attractive features as a market for fuel retailers. While fuel sales in Western European markets are either stagnant or falling, fuel sales through the Polish public network have grown by more than 50% since 2000.

Furthermore, compared to other European markets, Poland offers a much greater potential for players such as BP to expand on the motorway. The most significant motorway construction project in Europe is currently underway in Poland, with around 2,000 kilometers of motorway either planned or recently completed. Based on the assumption that there will be a service station for every 40 kilometers of motorway on both sides of the road, there will be space for an additional 100 motorway sites in Poland; a dramatic increase from the current 15 sites.

Also, competition law dictates that national fuel retailer PKN Orlen will not be able to retain its status as the sole fuel retailer on most motorways. Polish law requires that, by the time the projects are complete, at least two or three different companies are present on each motorway, giving players such as BP an opportunity to invest.

BP’s wish to remain and expand in the Polish fuel retail market is not surprising, especially given the strong growth in fuel sales. Furthermore, the large motorway initiative and the new laws forcing competition into the motorway sector offer the company a rare growth opportunity in an attractive market.

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