Malaysia has a vibrant Oil and Gas industry. As a direct effect of this the government revenues is in a great extend derived from the industry. Interesting to mention, PETRONAS (National Oil Co.) have paid in 2008, 67.6 billion RM, a figure which represents the 44% of the federal government revenue. PETRONAS is an important economical player not only for the country but for the global Oil and Gas industry, as it is ranked among the FORTUNE Global 500® largest corporations in the world.
The biggest amount of Malaysia's oil comes from offshore fields. The continental shelf of the country is divided into 3 basins: the Malay (west) and the Sarawak and Sabah (east). The majority of the country’s oil reserves is located in the Malay basin and is of high quality.
Regarding the natural gas, much of the country’s production comes from Eastern Malaysia, offshore Sarawak and Sabah. In order to exploit the gas resources that it poses, Malaysia has one of the most extensive natural gas pipeline networks in Asia. The Malaysian pipeline project Peninsular Gas Utilization (PGU) project was completed in 1998. The Peninsular Gas Utilization system spans more than 880 miles and has the capacity to transport 2 billion cubic feet /day (Bcf/d) of natural gas. The country is also connected with pipelines with Singapore and Indonesia.
The significance that natural resources have in the formulation of Malaysian economical policy made the government of the Asian state to formulate several energy policies in the past. The scope of these politics is to regulate the oil and gas industry in order to achieve the country's economic development needs which are as it is specifically highlighted by the Malaysian Ministry of Energy, Green Technology and Water:
- Making available adequate supplies at reasonable prices to support national economic development objectives, thus, placing the application of oil and gas resources to serve national needs as first priority;
- Promoting greater Malaysian representation and providing a favorable investment climate, including creating opportunities for downstream industries; and
- Effecting an optimal social and economic pace of exploration of the country's endowment of exhaustible oil and gas resources, taking into account the need for conservation of these depleting assets and the protection of the environment.
PETRONAS is the synonym of oil and gas for Malaysia and was created under the Petroleum Development Act in 1974. With the Petroleum Development Act in 1995 the company entered into Production sharing Agreements along with other major petroleum companies.
What follows is a list of these major petroleum companies:
- Petronas Carigali
- Esso Production Malaysia
- Shell Sabah Selatan
- Nippon Oil
- Lundin Malaysia
- Sabah Shell Petroleum
- Sarawak Shell Berhad
- NORSK Hydro
- Sante Fe Energy Resources
- AMERADA HESS
- YPF Malaysia
- Mitsubishi Corporation
- Murphy Sarawak
- Esso
- JAPEX
Malaysia experienced an economic boom and underwent rapid development during and by the end of the 20th century. Major reason of this development was the exploitation of oil and gas, a fact that everyone should consider while studying Malaysia and its oil and gas industry.