How to apply online for LPG distributor franchise of IOCL, HPCL, BPCL ?


Are you interested in setting up an LPG distributorship for IOCL, HPCL or BPCL in India? This article provides the complete information on how to apply for appointment to become an LPG distributor in India. Details of the categories, infrastructure and other eligibility requirements as well as the application procedure is provided.

From time to time, Indian Oil Corporation Ltd (IOCL), Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL) invite applications, like they have done this month to appoint LPG distributors in various States of India. You can apply in various type of categories and in reservation categories of Open Category (O), Schedule Castes / Scheduled Tribes (SC/ST) and Other Backward Classes (OBC), as well as sub-categories of: Government Personnel category (GP) consisting of Defence, Central/State Govt. and Central/State PSU employees / Ex-servicemen / Special forces; Physically Handicapped Personnel (PH)/ Divyang; Combined Category (CC) consisting of Outstanding sports person (OSP) and freedom fighters(FF); Women; Unreserved.

Categories

You can apply for LPG distributorship under the following categories:
  1. Sheheri Vitrak: This is for LPG Distributorship located in Urban Areas, giving service LPG Customers located within the Municipal Limits of the Metro city/City/Town.
  2. Rurban Vitrak: This is for LPG Distributorship located in Rural Urban areas. That is, you will be giving service to LPG customers in urban areas as well as to in specified rural areas, generally covering all villages falling within 15kms. from the municipal limits of the LPG distributorship location and or the area specified by the respective Oil Marketing Companies (OMCs).
  3. Gramin Vitrak: This is for LPG Distributorship located in Rural areas, giving service to LPG customers of the specified rural area, generally covering villages within 15kms. from the boundary limits of the LPG distributorship location and or the area specified by the respective Oil Marketing Companies.
  4. Durgam Kshetriya Vitrak (DKV): This is for LPG Distributorship located in Difficult and Special Areas where generally it is not feasible to set up the other types of Distributorship mentioned above. Such areas would be: a forest area, a hilly region, an area inhabited primarily by Tribals, a region which where the population is sparse, an island, a Left Wing Extremism (LWE) affected are, etc.




Eligibility requirements

  1. Nationality: You must be an Indian citizen and be a resident of India.
  2. Educational qualification: You should have passed minimum Std. 10 exam or equivalent from a recognized Board. However, this criterion of educational qualification does not apply to those in the Freedom Fighter (FF) category.
  3. Age criteria: You should be not less than 21 years and not more than 60 years in age as on the date of publication of the advertisement/notification. There is no age restriction for those who apply for locations reserved under Freedom Fighter (FF) category.
  4. Health: You must be physically & mentally sound to be able to run the LPG business.
  5. General: You should not have been convicted nor faced charges by any Court of Law for any criminal offense involving moral turpitude or economic offences. Further, you should not have been a signatory to distributorship or dealerships agreement which was terminated on account of malpractice or adulteration of any Oil Marketing Company. Nor should you have resigned from Sole proprietorship of any dealership/ distributorship of any PSU Oil Marketing Company in order to transfer the dealership/distributorship in favor of any.


Ineligible applicants - Who cannot apply ?

Multiple Dealership / Distributorship is not allowed as per the norms. That is, you cannot apply if you or any member of your family holds a dealership/LPG distributorship/ or Letter of Intent (LOI) for a dealership/LPG distributorship of any type of a PSU Oil Company. That is, only one Retail Outlet / SKO-LDO dealership / LPG distributorship of a PSU Oil Company will be allowed to a family (please refer to the official brochure for exceptions to this norm for existing SKO dealers of OMC

Further, you cannot apply if you are a family member of an employee of any Oil Marketing Company as on the date of application.

Location requirement

The location to set up an LPG Distributorship is identified based on available refill sale potential, this ensuring that the LPG distributorship is economically viable. The refill sale potential is based on the number of households, per capita consumption, LPG coverage and the existing/ proposed PNG connections if any.

Basic infrastructure requirements

You should have (or will construct) a godown to store LPG of the stipulated capacity and obtain all the necessary approvals from official statutory bodies, including the Petroleum & Safety Organization (PESO) within the time period mentioned in the Letter of Intent (LOI.) In case the land meets the requisite specification Field Verification of Credentials (FVC) on the basis of which LOI has been issued, then you can also offer an alternate land site for construction of the godown of specified dimensions which will be considered on the grounds of enhanced security, location and other parameters. This also applies for the setting up of a showroom.

Godown requirements

The minimum capacity of the LPG Godown is:
  1. For Sheheri Vitrak and Rurban Vitrak 8000 Kg LPG.
  2. Gramin Vitrak: 5000 Kg LPG
  3. Durgam Kshetriya Vitrak: 3000 Kg LPG


The required minimum Dimensions of land and the location of Godown land is:
  1. For Sheheri Vitrak and Rurban Vitrak: You should own a plot of land of minimum dimensions 25 Metre x 30 Meter in the city or of the location offered in the same State.
  2. For selected candidate for Sheheri Vitrak & Rurban Vitrak locations falling under 'X' and Ý' category Metro Cities/Cities/State: You can construct the godown in and within 15 kms outside the Municipal limit of the town/City of the advertised location. If set up outside the municipal limits, then you will have to bear the expenses for moving LPG cylinders in and out of the City/town
  3. For Gramin Vitrak: You should own a plot of land of minimum dimensions 21 Meter x 26 Meter within 15 km from the advertised location.

Important: The land should be plain and free from live overhead power transmission or telephone lines. There should not be any canals or drainage passing through the plot.

The approach road must be a accessible and such that it is motorable during all types of climatic conditions. The road should either a public road or a private road connecting to the public road of minimum 2.5 meter width to allow unhindered access for LPG Cylinder Trucks. In case of private road connecting to the Public Road, the same should be either owned/registered lease or having a right of way from the owner(s) of the land. In case the State Government has stipulated an approach road of wider dimensions, then the same should be made available. It should be ensured to provide the approach road within the time frame stated in the LOI and an undertaking of this assurance needs to be submitted. The approach road will be verified for its suitability before the issuance of Letter of Appointment. In the event of not having a suitable approach road, the LOI may be cancelled along and you will forfeit the 10% security deposit.

For applying under the categories of Sheheri Vitrak, Rurban Vitrak and Gramin Vitrak, you should have adequate delivery infrastructure for home delivery of LPG Cylinders to the customers as specified by the OMC in the LOI. You will also need to procure adequate number of electronic portable weighing scales of required specification for demonstration of correct cylinder weight to the customers as per statutory regulations.

[Please refer to official brochure for complete details]

Showroom requirements

This is applicable only for Sheheri Vitrak, Rurban Vitrak, and Gramin Vitrak locations and not for Durgam Kshetriya Vitrak locations.

You should own a suitable shop for Showroom of minimum size 3 meter by 4.5 meter in outer dimension or a plot of land for construction of showroom of the same dimensions as on the last date for submission of application as specified in the advertisement or corrigendum (if any) at the advertised location. The showroom must be easily accessible through a suitable approach road.
If you have a registered lease deed which begins on any date prior to the date of advertisement, then also you may be considered, provided the lease is valid for a minimum period of 15 years from the date of advertisement.



Security Deposit

Once you are issued an appointment letter, you must deposit interest free refundable security deposit to the respective OMC. The security deposit of 10% applicable for the respective type/category of LPG Distributorship collected from you prior to issuance of LOI, will be adjusted against the below mentioned security deposit as applicable.
(i) Sheheri Vitrak: Open category - Rs.5 Lakhs; OBC category - Rs.4 Lakhs; SC / ST category – Rs.3 Lakhs.
(ii) Rurban Vitrak: Open category - Rs.5 Lakhs; OBC category - Rs.4 Lakhs; SC / ST category – Rs.3 Lakhs.
(iii) Gramin Vitrak: Open category - Rs.4 Lakhs; OBC category - Rs.3 Lakhs; SC / ST category – Rs.2 Lakhs.
(iv) Durgam Kshetriya Vitrak (DKV): Open category - Rs.4 Lakhs; OBC category - Rs.3 Lakhs; SC / ST category – Rs.2 Lakhs.
[Check advertisement notifications when issued for any change in the security deposit]

Further requirement: Before issuance of Letter Of Appointment by the OMC, you must submit a Notarized Affidavit certifying that he/she is not employed in private sector or are not drawing any salary/perks/emoluments (other than pension) from the State/Central Government/PSU. Also, if you are already employed, you will need to resign from the current job and cannot take up any other employment.

Application and selection process

Selection for LPG Distributorship will be made by inviting applications through Advertisement/ Notification under appropriate category in newspapers. The details of the locations advertised will also be available at the websites of the Oil Companies (refer to the end of this article) and also at LPG Vitarak Chayan website www.lpgvitarakchayan.in. Applications should be done only through the registration process at this website, along with requisite application fee. A draw of lots will decide the list of eligible applicants.

The selected candidate (LOI holder) would be given training and has to clear pre- commissioning quiz/test by scoring qualifying marks that is 80%. In case LOI holder secures less than 80% marks in the quiz, re-training would be given and re-test conducted.

The tenure of the HPGas (HPC)& Bharatgas (BPC) Distributorship shall be for an initial period of 10 years and renewable for every 5 years thereafter, subject to satisfactory performance of the distributorship by the respective OMC and decision thereon. In the case of IOCL LPG Distributorship, it is for an initial period of 10 years from the date of execution of Distributorship Agreement and will continue thereafter until determined as per rights mentioned in the Distributorship agreement.

Brochure and Guidelines available at

  • IOCL: https://iocl.com/Talktous/LPG_Guidelines.aspx
  • BPCL: https://www.bharatpetroleum.com/Bharat-Petroleum-For/Business-Associates/Distributors.aspx
  • Bharat Gas: https://www.ebharatgas.com/pages/Dist_Appointment/Distributor_Appointment.html
  • HPCL: http://www.hindustanpetroleum.com/businessopportunities


Article by Vandana
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