SPC secures iconic Esso petrol station at S$500,540 monthly rental

Last month (22 Aug), the Singapore Land Authority (SLA) announced the tender results for a 21,441.89 sqft plot intended for petrol station operations.

This land, located in Tampines at 9 Tampines Ave 7, once served as the backdrop for the popular 90s local sitcom “Don’t Worry Be Happy.”

Previously, ExxonMobil leased the plot for over 30 years.

The tender was secured by Singapore Petroleum Company Ltd (SPC), a wholly-owned subsidiary of PetroChina International (Singapore) Pte. Ltd. This company is a listed entity of the state-owned China National Petroleum Corporation, headquartered in Dongcheng District, Beijing. It holds the distinction of being Asia’s largest oil and gas producer.

SPC’s winning bid was S$500,540 per month, totalling approximately S$54 million over the 9-year lease period. In contrast, ExxonMobil placed a bid of S$376,000.

To provide some context, SPC needs to generate at least $16,685 daily just to meet the lease expenses owed to the SLA.

Considering these steep rental charges, it’s understandable why, even during periods of significant oil price drops, Singaporean oil companies might be hesitant to significantly reduce pump prices.

Regardless of the volatility in oil prices, SLA continues to collect high rentals from the various oil companies operating within Singapore.

In the end, these substantial rental fees are inevitably passed down to Singaporean consumers, reflected in higher pump prices.

However, the SLA also leases out seemingly “cheap market-valued” plots for residential purposes.

For instance, the Law Minister, K Shanmugam, rents a 249,371 sqft plot for just S$26,500 a month. This land area is more than ten times larger than SPC’s plot, yet the cost is over 18 times less.