C Corp., Taiwan, the state-owned petroleum, natural gas and petrol retailer on the island, has been assessing the possibility of joining hands with its Chinese counterpart China National Petroleum Corp. (CNPC) to open 200 gas stations in Fujian Province, southeastern China, according to the Taiwanese company

The main reason behind the plan to be undertaken by the two companies is that CPC, which has been well-recognized in Fujian where a large number of Taiwanese companies operate, has intended to explore the market by running fuel stations locally.

Given the fact that most gasoline and diesel needed in Fujian are transported distantly from northeastern China at high transport costs, market observers said that CPC's intension makes quite good sense, because this situation in the province will make its petroleum products, shipped from Taiwan much shorter distances, more price competitive than rivals in the market.

In fact, the two companies have worked closely with each other since signing a memorandum of understanding in 2010, and are reportedly going to set up a joint venture to run gas stations under a collective brand in Fujian, which has yet to be seen in Taiwan's petroleum industry.

CPC directors said that the cooperation plan remains on the drawing board for the time being, because this will have to be subject to approval by Taiwan's Ministry of Economic Affairs. But, if coming true, the gas-station running plan will generate sales turnover of about NT$40 billion for both sides in the future, noted market observers.