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The agreement, which went into effect on Jan. 1 and expires on Dec. 31, 2019, calls for BP to supply motor fuel to 394 Pantry convenience store locations, many of which are branded as Kangaroo Express. The pact also has provisions that allow c-stores to be either added or removed during the contract term for “specified reasons,” The Pantry reported in an 8-K filing to the U.S. Securities and Exchange Commission.
"We have developed a strong relationship with BP Products North America Inc. over the last several years and are pleased that we will be continuing that relationship,” said Dennis Hatchell, president and CEO at The Pantry. “Our new contract will allow us to continue to provide Kangaroo Express customers with the high quality products that they need and expect.”
The new contract replaces a similar agreement between the companies that went into effect on Feb. 1, 2003 and was set to expire on Jan. 31 of this year.
“We continue to strengthen the BP brand in the Southeast through strategic relationships with customers like The Pantry," said Corey Correnti, BP’s vice president of sales, marketing and supply. “These sites offer competitive formats and represent the BP fuel brand well."
Petroleum prices The Pantry pays to BP will be based upon industry indexes. A stipulation in the agreement states if The Pantry fails to purchase its annual minimum contract value of petroleum, BP can charge a shortfall penalty of 2 cents per gallon times the difference between the number of gallons purchased and the minimum volume requirement.
The 8-K filing did not indicate an exact figure regarding the minimum number of gallons The Pantry must purchase from BP under the new agreement.
Cary, N.C.-based The Pantry Inc. operates 1,572 convenience stores in 13 states under select banners, including Kangaroo Express, its primary operating banner.