Oil-rich Norway loses its gas stations
July 22, 2009
Norway has more cars than ever before, as its oil-fuelled economy continues to boost affluence, but gasoline stations have been shutting down all over the country. Their operators claim they can’t make any money off them, and motorists are having to drive farther to fill up their tanks.
In 1999, Norway had more than 2,200 gasoline stations scattered around the country, according to the Norwegian Petroleum Institute. By the beginning of this year, the number was down to 1,610. More have closed this summer.
Since the beginning of 2008, nearly 60 Shell stations have landed in bankruptcy court, reports newspaper Dagens Næringsliv (DN) . Their operators say their customers have become less likely to spend money inside the station’s convenience stores, while motorists also have been driving less. The high price of fuel last year prompted many drivers to leave their cars at home and take public transport.
State highway officials estimate that traffic along the E6 highway, Norway’s busiest, has dropped around 10 percent.
Norske Shell franchises out around 160 of its stations around Norway. DN reported that 15 of the operating companies running 58 of the stations went bankrupt last year. They complained that they had to take on leasing costs for Shell’s automatic car washes and were ordered to offer a wider variety of fast food in their retail stores. Many couldn’t handle the added costs.
Other gas station operators say they can’t earn any money off gasoline sales, despite Norwegian pump prices that amount to about USD 7.50 a gallon at present. Stations operated by the oil companies themselves face high costs distributing gasoline to stations in remote areas. So more and more gas stations are standing empty and forlorn along Norwegian roads and in town.
On the vast plains of Finnmark County, where stations can be 200 kilometers (120 miles) apart, local officials are worried. Those running the city of Vardø in northern Norway felt compelled to take over a station when its operator gave up. “Otherwise we would have had to drive 75 kilometers to Vadsø to fill the tank,” Mayor Rolf Einar Mortensen told newspaper Dagsavisen . Private operators took over again in February.
Dag Roger Rinde of Statoil Norge said he thinks Norway will have less than 1,000 gasoline stations 15 years from now. “People keep moving away from small places,” he said. “When the population base becomes too small, the post offices disappear, then the grocery stores and now the gasoline stations.”