PETALING JAYA: National oil company Petroliam Nasional Bhd’s (Petronas) move to reduce its workforce to the “right size” is not due to its latest agreement with the Sarawak government on gas distribution.
President and CEO Tan Sri Tengku Muhammad Taufik Tengku Aziz said negotiations between Petronas and Sarawak’s state-owned oil and gas com-pany Petros since last year have raised concerns about their impact on Petronas, a key contributor to federal funds, and its operations in Sarawak, which holds more than 60% of Malaysia’s gas reserves.
Muhammad Taufik stated that future oil and gas development projects would face thinner margins and greater technical challenges.
He said changes in the com-position of production sharing contracts were expected, leading to a reduction in Petronas’ revenue share. He added that the company’s lucrative margins, which currently exceed 20%, were projected to decline to the lower double digits in the coming years.
Looking ahead, Petronas must go beyond being just an oil and gas supplier by offering more products such as blue ammonia, a clean fuel derived from hydrocarbons, he said during a town hall session last Friday.
Petronas has nearly 50,000 employees, according to its website.
The company confirmed media reports in an email response to Reuters, stating that the number of affected em-ployees was not mentioned during the briefing.
Malaysia’s national energy company, Petronas, will reduce its workforce to ensure its long-term sustainability amid in-creasing challenges in the global operating environment, Muha-mmad Taufik said.
“The rationale for this move is to secure Petronas’ survival in the coming decades.
“If we do not act now, there will be no Petronas in 10 years,” he said, without specifying how many jobs would be affected.
