Caltex yesterday announced pricing arrangements that allow all its E10 Unleaded petrol to be sold at 3 cents a litre less than regular unleaded petrol.
There are currently 41 sites selling Caltex's E10 Unleaded in Queensland and New South Wales under the Caltex, Ampol and Bogas brands. More than 100 sites are targeted to be selling E10 by the end of this year.
Caltex managing director Des King said Caltex company-operated service stations that supply E10 Unleaded will sell it for 3 cents a litre less than regular unleaded petrol.
"The pricing decision is part of Caltex's strategy to meet its annual biofuels supply targets. These targets have been committed to the Australian Government as part of its industry action plan for biofuels.
"The decision also recognises the concerns of motorists about current petrol prices driven up by record high world oil prices," he said.
Caltex marketing general manager Mark Burrowes said Caltex was also selling E10 Unleaded to its resellers - its wholesale fuel distributors - at a wholesale price 3 cents per litre less than regular unleaded petrol, so they could discount E10 Unleaded to their Caltex, Ampol and Bogas branded, and other service station customers.
"For some resellers, E10 Unleaded must be trucked from more distant terminals than for unleaded petrol, incurring additional freight costs. The amount of discount passed on therefore may have to take into account
these additional freight costs,” he said.
"Caltex is also discounting the wholesale price of E10 Unleaded by 3 cents per litre to its franchised service stations, so they are able to set an E10 Unleaded price at a discount to regular unleaded petrol.
"Franchisees are solely responsible for setting their own pump prices but the highly competitive petrol market should see the lower wholesale price passed on to motorists.
"Price support arrangements for franchisees will ensure the 3 cents per litre discount can continue to be provided even when unleaded petrol prices in major metropolitan areas are heavily discounted.
"Caltex E10 Unleaded is being supplied from Caltex terminals in Newcastle and Cairns. Investments in tanks and other facilities at Caltex terminals are being planned, together with other terminalling arrangements. These additional supply points will help reduce freight costs."
E10 Unleaded is a blend of 10 percent ethanol in regular unleaded petrol, which meets the national fuel quality standard. It is suitable for use in most new vehicles and many older vehicles.
Caltex has been supplying E10 Unleaded petrol since 1996 through one of its resellers in NSW. E10 Unleaded was launched under the Caltex and Ampol brands in Queensland in 2003. Caltex independent and company-owned resellers have taken the lead in developing the E10 Unleaded market. Depending on the service station, ethanol used in E10 Unleaded is derived from either sugar cane or wheat.