A building consent process is under way to bring low-cost fuel retailer NPD to Whanganui.

Whanganui District Council regulatory and compliance operations manager Jason Shailer said the council was currently working through the consent process for the retailer to establish a station in the city.

It is planned to build the station at 233 London St, a stretch of road where Z and BP stations already operate.

The announcement comes after calls were made in May this year for a higher level of fuel retail competition in Whanganui and Ruapehu, which have great price disparities to neighbouring regions.

According to fuel finder app Gaspy, prices in Whanganui for 91-octane fuel range from $2.35 to $2.49 per litre.

Comparatively, fuel in Marton ranges from $2.15 to $2.24, while in Bulls it ranges from $2.18 to $2.25.

The Government’s petrol excise tax is set to end on July 1, reversing a 25c per litre excise duty tax cut on fuel which has been in place for the past 15 months.

Whanganui District Councillor Michael Law said in February the council asked fixed-price retailers, whose prices do not change based on location, to establish themselves in Whanganui.

“NPD wasn’t one of the retailers we contacted but they heard about our goal of getting a fairer deal for Whanganui,” he said.

NPD, or Nelson Petroleum Distributors, is a New Zealand-owned and operated wholesale distributor of Mobil fuels and Castrol lubricants.

The company has been in business for more than 50 years and has stations in neighbouring cities in Palmerston North and New Plymouth, but none in Whanganui, Rangitīkei or Ruapehu.

The nearest NPD station in Palmerston North currently sells 91 octane petrol at $2.17 per litre.

Law said the business could be a game changer for fuel prices in the district.

“It’s vital to recognise that lack of competition isn’t the issue here; what’s needed is a fresh approach to the fuel business model.”

There was evidence from various case studies showing it could take only one fuel supplier to act as a catalyst for market price adjustments, which could happen with NPD in Whanganui, Law said.

New Zealand Automobile Association spokesman Terry Collins said the company operated under a low-cost model, meaning the station was made of a forecourt with motorists paying at the pump and no shop, carwash or other features.

Low-cost retailers were becoming more common in the market and had lower overhead costs than fuller service stations like BP or Z, which resulted in different, generally lower pricing models.

Collins said Whanganui had been having problems with price disparity and the introduction of more competition was always good.

“Whanganui has had some high prices and new entrants could definitely have some impact on the pricing, hopefully.”

NPD was contacted for comment.

Finn Williams is a multimedia journalist for the Whanganui Chronicle. He joined the Chronicle in early 2022 and regularly covers stories about business, events and emergencies. He also enjoys writing opinion columns on whatever interests him.