President of Malaysia Petroleum Resources Corporation (MPRC), Datuk Shahrol Halmi (right) and Senior Vice president Industry Stratery Malaysia Petroleum Resources Corporation (MPRC), Syed Azlan Syed Ibrahim. Picture by NUR ADIBAH AHMAD IZAM


KUALA LUMPUR: Malaysia is set to become the oil and gas hub by year 2020 and is well on target towards becoming a regional hub within three years.

Malaysian Petroleum Resources Corporation (MPRC) said the country, deemed as one of the fastest growing economies in the Asia Pacific region and home to market-oriented economy and pro-business government policies, is also aims to ensure its local players to become regional players in the sector.

MPRC chief executive officer Datuk Shahrol Halmi said it is important to have Malaysia’s reputation at play to become a hub, and not just beating the drum claiming to be one.

"We also have strategies to ensure that we get there, and working hard to make sure it happens.

“It is crucial to attract the multinational companies (MNCs) to come to Malaysia and ensure that they make Malaysia as a regional base for the region.

“A hub is not just a hub. It brings other benefits to the Malaysian economy such as technology transfers, job opportunities and high-paying jobs as well,” Shahrol said in an exclusive interview with NST Business recently.

He said out of 50 MNCs in the globe currently, 18 MNCs have already set up their regional operational headquarters in Malaysia.

"An operational headquarters is important as the scale is bigger compared to having a com setting up just departments such as finance or human resources.

"We are on target, in terms of reputation building, attracting MNCs to set up operational HQs and our players becoming regional players.

"Our stretched target is to have at least half of the global players to have operational HQs in Malaysia,” he said.


Malaysia aims to grow its aggregate production capacity for oil, gas and energy by five per cent per annum between 2010 to 2020.

Most of this growth will come from enhancing the output of its O&G fields as well as new marginal fields while enhance exploration and development of deepwater areas.

The dynamic relationship between the country’s public and private sectors has also developed a strong O&G ecosystem that is supported by an investor-friendly legislative and regulatory framework and well-developed infrastructure.

Speaking on the country’s wants and needs as well as the challenges faced by the local players, senior vice-president Syed Azlan Syed Ibrahim said MPRC also wants to elevate the local players to become regional or global players.

This, he said, is part of the definition to becoming a hub for Malaysia.

"Cost structure is exceptionally important now for O&G companies while adjusting to the new norm. Cost structure is the name of the game, if I may say so.

“What we realise is, when companies decide on the location of the operational headquarters, it important to have close proximity to their client, good living standards and availability of talent.

‘We are proud that we have all three in the country to offer these MNCs to come here. Incentives are usually just the sweetener to the deal,” he said.

He said the challenge lies mostly in pushing local players to become regional players, and added that local players are not all fully-independent and need to have their own value –proposition or technology.

“We believe the market is mature enough for our players to develop their own technology, products or services. We are currently in the transition phase from being an agent of other company’s technology to coming up with our own,” he added.

There are about 3,956 O&G services and equipment (OGSE) businesses in Malaysia comprising international oil companies, independents, services and manufacturing companies that support the needs of the value chain both domestically and regionally.



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