Seatrade Maritime is part of the Informa Markets Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Petronas boss wants more consolidation in Malaysian oil & gas sectors

Petronas boss wants more consolidation in Malaysian oil & gas sectors
Malaysia's oil and gas (O&G) industry needs still more consolidation and preference will be given to those that invest in assets, local media quoted national oil company Petroliam Nasional (Petronas) president and chief executive Wan Zulkiflee Wan Ariffin as saying.

Repeating his comparison between Norway's O&G sector and Malaysia's he noted that there is still a long way to go before Malaysia reaches efficient levels.Between the two countries, which have similar-sized deposits, Petronas has about 3,700 registered contractors while Norwayhas just around 700 players in its O&G sector.

Wan Zulkiflee pointed out that among the 3,700 were agents who did not invest in O&G assets and were reaping handsome profits.

“Imagine a commission of just 1% for the kind of contracts that we award. It runs into a big sum for the agents. We want to only help those who have invested in their assets and grown their expertise,” he said.

Wan Zulkiflee added that Petronas is trying to assist contractors by being more transparent with its requirements, however the reality is that in the current environment, there is just not enough work to go around.

“We did not do this before. But now, we engage and inform the industry on what we require. We will tell them how many platforms, rigs and other services we will be needing,” he said, adding: “We hope this gives the industry a sense of reality.”

For example he said although there are eight O&G fabrication yards in Malaysia, Petronas’ requirements for the next few years would only be sufficient to cater to the optimum utilisation of two to three of these.

“We are not in a position to help all eight because we simply do not have work to give. The requirements have scaled down due to the low oil price environment,” he said.