Latest news with #Samirul
New Straits Times
30-04-2025
- Business
- New Straits Times
Petronas-Petros clarity needed to stem investment outflow: Analysts
KUALA LUMPUR: Sarawak could be looking at a broader pattern of foreign direct investment outflow barring greater regulatory clarity, several analysts suggested. Speaking to FMT, senior consultant Samirul Ariff Othman said a mix of local and international challenges motivated the recent ConocoPhilips exit from the Salam-Patawali project. The US oil major's exit from Salam-Patawali comes months after another foreign oil and gas company, Thailand's PTTEP, shelved the Lang Lebah gas project until 2026. Industry observers point to the ongoing regulatory uncertainty caused by the unresolved Petronas-Petros settlement as causing this two-year delay, as reported by Scoop. While each project has unique challenges, the back-to-back cancellations suggest a potential emerging trend influenced by economic pressures and regulatory uncertainties," Samirul from Global Asia Consulting said. In 2025, an ongoing trade war between the United States and various countries has triggered other economic risks. These include fears of inflation and recession, as well as falling oil prices. "Fluctuating global energy prices and economic uncertainties can impact investment decisions in large-scale O&G projects. "The combination of rising costs, global market volatility, and unresolved local disputes may lead other investors to reassess their commitments in the region," Samirul said. Jamil Ghani, a former analyst with the Malaysia Petroleum Resources Corporation, told FMT that regulatory clarity is of utmost importance to stabilise Malaysia's business environment. "Regulatory uncertainty - especially the unresolved role of Petros as the state's designated gas aggregator - risks amplifying investor anxiety. Although Petronas has confirmed that discussions with Petros are ongoing, ambiguity around intermediary or middleman arrangements undermines confidence at a time when national cohesion is critical," Jamil said, referring to the federal government's insistence that Petronas' contracts remain untouched with no middleman involved. Amid a challenging global environment, he stressed that Malaysia cannot afford the perception of internal disunity - least of all in its strategic energy sector. "If Petronas is to remain a bulwark of national stability, policy cohesion and operational continuity must take precedence," Jamil added. "That means Sarawak and the federal government must urgently stabilise the current dispute for the economic resilience of an entire nation." Long-term regulatory clarity is crucial for attracting and retaining foreign partners in Malaysia's upstream sector. "Clear and stable fiscal terms, along with consistent enforcement of production sharing contracts, are essential to maintain investor confidence," Samirul said. Challenges ahead According to Upstream, the Salam-Patawali was not a large project but a pivotal one considering Malaysia's ambitions to raise oil and gas production. The standalone development, which involved a floating vessel capable of handling over 100 million cubic feet of gas, was well-supported by Petronas. According to Upstream Online, Petronas is keen to continue the project but cannot take it forward alone for the time being due to lack of capacity. Pritish Bhattacharya, a research officer at Singapore's ISEAS-Yusof Ishak Institute, told FMT Sarawak's push for oil and gas autonomy has put Petronas's monopoly at risk, with broader repercussions for the national economy and local industry. Pritish said the implications for the overall Malaysian economy are still "very hard to quantify". "(On the other hand), the potential loss of Petronas's resource access will create spillover challenges for international oil companies that are accustomed to centralised dealings," he said. This will be a concern especially in terms of foreign investments. These investors have essentially dealt only with Petronas in their dealings in Malaysia, and it could complicate matters if they now have to work with Petros. Jamil said the sector's domestic value chain is wide and vulnerable. According to the statistics department, there were 2,894 establishments engaged in oil and gas services and equipment activities as of the latest census.
Malay Mail
22-04-2025
- Business
- Malay Mail
Billions at stake as experts say Sarawak's ambitious plans lack key groundwork
KUALA LUMPUR, April 22 — Sarawak must take a more cautious approach in evaluating its mega projects amid global economic uncertainties, said analysts who warned that these would falter unless the state addresses major issues. Free Malaysia Today reported that the call follows Sarawak Premier Tan Sri Abang Johari Openg's announcement of a review of development policies in light of shifting global trends. Experts warn that factors such as talent shortages, high costs, and demand risks could undermine major initiatives like the new airport, transport system, and gas roadmap. Asrul Hadi Abdullah Sani of ADA Southeast Asia said a lack of skilled workers could threaten both construction and long-term operations. 'One of the main risks associated with Sarawak's mega-projects, such as Air Borneo and Petros, is the shortage of talent for key roles and the general workforce," he said in the report. 'Non-Sarawakian Malaysians have always been required to get a permit to work in Sarawak'. He suggested that easing immigration rules could help attract more skilled workers from outside the state. According to Samirul Ariff Othman of Global Asia Consulting, the proposed new airport, designed for 15 million passengers annually, could face underutilisation. 'This expansion is seen as a strategic move to boost tourism and business travel, enhancing Sarawak's connectivity and economic growth,' said Samirul. 'But the proposed (new) capacity significantly exceeds current usage, raising questions about potential underutilisation.' He noted that the RM100 billion allocation for the airport and Tanjung Embang port must be matched with strong demand to be sustainable. Samirul also raised concerns over the RM6 billion hydrogen-powered Autonomous Rapid Transit (ART) system, citing its high infrastructure and maintenance costs. State assemblyman Violet Yong previously questioned the cost, saying: 'The state is paying a China firm to manufacture the vehicles for Sarawak, but that firm had stopped production for their China market due to cost factors as hydrogen fuel is extremely expensive to produce, as is the case all over the world.' The Sarawak Gas Roadmap 2030 may also fall short without significant foreign investment, according to industry analysts. 'In the end, the Sarawak Gas Roadmap's success depends on the appetite of potential foreign investors,' said one analyst. Although Sarawak is drawing heavily on oil and gas revenue and federal allocations, analysts say prudent project planning will be critical to securing long-term returns. The Sarawak government and its linked companies are currently funding the projects through a combination of oil and gas revenue, state reserves, and federal support. As of 2024, Petronas had channelled RM96 billion to Sarawak's coffers, while infrastructure and upstream investments have reached RM280 billion. Despite receiving a RM600 million special grant and RM5.9 billion in federal development funds, Sarawak spent only 54.43 per cent of its 12th Malaysia Plan allocation, below the national average.
