Petronas continues to review asset portfolios with value driven decision-making
KUALA LUMPUR (Aug 11): Petroliam Nasional Bhd (Petronas) continues to review its asset portfolio periodically, with parameters continuously adapted and set to ensure it delivers value.
Petronas executive vice president and chief executive officer of upstream Mohd Jukris Abdul Wahab explained that Petronas reviews its portfolio from time to time to ensure that it meets certain standards set to create and deliver value.
'We need to make sure that our assets in the portfolio remains authentic. As I said, we have redefined our portfolio characteristics to meet certain standards,' he said during Petronas' media briefing on upstream asset management on Monday.
'Or example, it has to meet oil price at US$50 or less. Anything that doesn't support it enough, the big question mark that we have to answer is do we keep this asset or not?
'And the portfolio also has to deliver certain operational efficiency. Any portfolio review that we are doing today has to be guided by some of these parameters – the value that it delivers and the upside that it still has – all these criteria have to be taken into consideration when we decide what we do with some assets that doesn't meet the price parameters.'
He explained that when certain Petronas assets become outliers, it was time to be honest with priorities. He noted that some of these assets will require an excessive capital requirement in order to function properly.
'That's not the best way to deliver value. It has to employ more capital to deliver more value from the asset,' he said. 'That's not the best way to do business. We have to bring in partners to collaborate with us to make sure that the partners take some risks out of us.
'We have actually slashed our presence in Sudan, for example, and also in Mexico and Afghanistan. This was consciously decided and guided by the parameters that we set ourselves. And if the time comes to do that, we will do it.
'When we take a decision to get up from a certain set, it is not a spontaneous decision. It has been carefully evaluated over the years.'
Jukris also highlighted that Petronas continues to evaluate more potential assets to be added to its portfolio as part of its adjustment exercise.
'We are not going to just leave the portfolio and do nothing. That is not how we sustain our business in the long run. But I must say that we are still aggressive on exploration.
'As we speak, we are doing well in Suriname. We have entered into a joint study agreement in Indonesia, Vietnam, Turkmenistan and Oman. These are some of the work that we are currently doing to make sure that the funnel will always be filled by exploration discoveries. To prepare us for the long run.'
He also underscored their drive towards cost efficiency as crude oil prices currently hover around US$64-US$65 per barrel, with expectations for the prices to remain at this level for quite some time.
'What we have done over the last 50 years may not allow us to be more competitive in the coming years. As far as upstream is concerned, we take a hard look into our operational practises.
'The environment around us is not very kind to us. The tariff imposition affects the supply chain. It affects the way we do business. How do we respond to these external challenges? The only thing that we can do is to respond internally.
'How do we drive ourselves to become more cost efficient? That will be some fundamental change that has to happen in terms of how we do things. This is what we are currently doing now. The focus now is more about doing things differently.
'The focus now for us is to drive the efficiency. Some of the processes that we have been adopting over the years, some of the standards that we have been adopting over the past few years, those have got to be challenged and have got to be rebuilt.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Barnama
2 hours ago
- Barnama
Basic Metals, Non-metallic Minerals And Wood Products Drive Foreign Investments In Sabah
KUALA LUMPUR, Aug 12 (Bernama) -- The three main industries in Sabah that recorded the highest foreign investments over the past decade (2015 to 2024) in the manufacturing sector were basic metal products, non-metallic mineral products, and wood products, according to the Ministry of Investment, Trade and Industry (MITI). For the state's services sector, the hotel and tourism sub-sectors, along with support services, were the main contributors. 'In terms of value, basic metal products recorded RM4.3 billion, followed by non-metallic mineral products at RM2.5 billion, and wood products at RM99.1 million. The hotel and tourism sector recorded RM205 million, and support services amounted to RM37.9 million,' the ministry said in a written reply published on the Dewan Rakyat portal today. The ministry was responding to a question from Datuk Jonathan Yasin (GRS-Ranau), who asked about the total foreign investment made in Sabah over the past 10 years and at present.
Barnama
2 hours ago
- Barnama
Dr Zaliha: Malaysia Promotes CHASE City Vision For Sustainable ASEANUrban Development
GENERAL KUALA LUMPUR, Aug 12 (Bernama) -- Malaysia today called on ASEAN nations to adopt an integrated urban planning approach, which balances environmental stewardship, social well-being, and economic competitiveness through the CHASE City framework. Minister in the Prime Minister's Department (Federal Territories) Datuk Seri Dr Zaliha Mustafa said that the framework, introduced in the Federal Territories, envisions cities that are Clean, Healthy, Advanced, Safe and Eco-friendly, offering a flexible model adaptable to the diverse realities of ASEAN cities. 'It is within this context of interconnected challenges that Malaysia has sought to define a guiding vision, one that is practical in implementation, yet adaptable to diverse circumstances across ASEAN. 'This is not a collection of separate agendas, but an integrated philosophy that guides urban policy, design and governance, in a holistic way,' she said. She said this in her speech at the ASEAN Sustainable Urbanisation Forum (ASUF), ASEAN Governors and Mayors Forum (AGMF) and the Meeting of Governors and Mayors of ASEAN Capitals (MGMAC) 2025, at the Kuala Lumpur Convention Centre (KLCC), here, today. Dr Zaliha said that the CHASE City framework aligns with ASEAN's urban priorities, as it enables collaboration between government, business, academia and civil society, to create sustainable, liveable cities. She cited the Kota MADANI development in Putrajaya as a tangible manifestation of the framework, incorporating low-carbon solutions, AI-driven smart technologies, active and safe mobility, green networks and community facilities. The minister also highlighted Malaysia's membership in the Davos Baukultur Alliance, making it the first country outside Europe to join the global coalition. 'This membership reflects our belief that cities are more than functional spaces. They are cultural and social ecosystems whose physical form should strengthen identity, foster inclusion and inspire pride among residents,' she said.
Malaysian Reserve
2 hours ago
- Malaysian Reserve
Petronas to expand LNG exports to new Asian markets
PETROLIAM Nasional Bhd. is seeking to expand its liquefied natural gas exports to growing Asian markets while also supporting Malaysia's rising energy needs that are being partly driven by a data-center boom. The state-owned company's diversified portfolio — which includes a newly operational export plant in Canada — will enable it to meet overseas demand for gas, said Adif Zulkifli, chief executive officer of Petronas' gas and maritime business. The firm plans to expand beyond its traditional markets — Japan, China and South Korea — to countries in Southeast Asia, including Vietnam and the Philippines, he said in an interview. But the gas-producing country is also eyeing more imports because its reserves are dwindling at a time when its energy requirements are growing thanks to a proliferation in power-hungry data centers serving the artificial intelligence industry. Malaysia imported about 3.3 million metric tons of LNG in 2024, up from 2.1 million tons in 2021, according to Bloomberg's vessel-tracking data. Petronas will continue exploration for more resources to sustain its domestic production, which has already peaked, Adif said. It operates one of the world's largest LNG terminals in Bintulu on the Sarawak coast, and has enough gas to fill up its plant there 'for as long as we need,' he added. 'We have brought in a number of upstream projects to make sure that we are able to deliver gas and sustain that for the next 20 to 30 years,' Adif said at the company's headquarters on the 42nd floor of the Petronas Twin Towers in Kuala Lumpur on Tuesday. 'We are also gearing up to bring in more imports into Peninsular Malaysia.' Traditional gas suppliers in Asia are being forced to rethink their export strategies as they try to reconcile rapid economic growth with falling domestic reserves. Malaysia, which was the world's fifth-largest shipper of the super-chilled fuel last year, usually meets domestic demand by topping up with cargoes from Australia. Petronas currently provides about 2.3 billion standard cubic feet of natural gas to Peninsular Malaysia and 'will try to sustain it as much as we can,' Adif said. Petronas CEO Muhammad Taufik said in June that Malaysia is set to be increasingly dependent on LNG imports in the next five years. In a bid to appease US President Donald Trump and secure a lower tariff from Washington in August, the Asian nation agreed that Petronas would buy $3.4 billion of US LNG annually. Malaysia leaning into imports to support its energy needs highlights a broader trend of once hefty producers having to turn to buying the fuel from overseas. Traders are also seeing more opportunity to sell gas to traditional exporters in the future. –BLOOMBERG
