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Oil, Gas And Energy
Last Updated : 17/3/2017 11:24 AM
 

Where we are today
The oil, gas and energy sector has been a mainstay of Malaysia's growth and contributes approximately 20 percent of national GDP. With the prospect of decreasing production from a maturing asset base, we will have to pursue sector-wide opportunities to reach the ambitious real annual-growth target and provide a sustainable energy platform.

Vision for the future
By 2020, Malaysia will have a more diversified oil, gas and energy sector that remains vital to our development, and that builds on the nation’s competitive advantages. A key thrust would be to intensify exploration and enhance production from domestic reserves. We will also develop a strong regional oil field services and equipment hub and a stronger presence in the regional midstream logistics and downstream markets. Finally, Malaysia has the potential to grow alternative energy sources such as nuclear, solar and hydro to overcome the decline in domestic natural gas production.

Targets and aspirations
The Oil, Gas and Energy NKEA is targetted to raise total GNI contribution to RM241 billion by 2020 from RM110 billion in 2009. As the base case projects a natural 2 percent decline in oil and gas production, this GNI target will require the NKEA to grow at an ambitious rate of 5 percent.  In achieving this, an additional 52,300 jobs will be created. A significant proportion of these jobs will be highly-skilled jobs with an estimated 21,000 jobs for qualified professionals such as engineers and geologists, with monthly salaries in the range of RM5,000 to RM10,000.

A total of 12 entry point projects have been developed across four themes to raise the sector's output and meet energy demand over the 10-year time frame.

  1. Sustaining oil and gas production
    Three EPPs will overcome the projected decline of 1 to 2 percent in domestic oil and gas production - capturing value from mature fields through enhanced oil recovery, using innovative solutions to develop small fields and intensifying our exploration activities.

  2. Enhancing growth in downstream
    Malaysia can capture the value created from increasing international flows of crude oil and refined products by building a regional oil-storage hub and developing a regasification terminal for imported liquefied natural gas.

  3. Making Malaysia the number one Asian hub for oil field services
    Malaysia will attract multinational corporations, consolidate domestic fabricators to increase their likelihood of winning major contracts and partner with world-class companies to establish a presence in the construction and installation portion of the value chain.

  4. Building a sustainable energy platform for growth
    Malaysia will diversify its energy sources beyond gas to fuel growth and honour our commitment to lower carbon emissions. Alternative sources such as solar and nuclear power will be developed, while at the same time energy efficiency measures will also be undertaken.

Enabling growth
Achieving our ambitious target will require RM218 billion in funding. Of this, less than 1 percent will be from the public sector. Additionally RM64 billion will be needed to offset the current decline in oil production, and the tax rebates to enhance energy efficiency will likely require RM12 billion.  Three key enablers need to be in place to ensure we achieve our target. These are providing effective investment support to ensure investors are actively courted and deals are enabled; ensuring investors can bring in the necessary expatriate talent; and introducing measures to increase the supply of graduates to staff the approximately 21,000 new jobs created at or above graduate level by 2020.

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