Malaysia’s oil and gas industry is governed by the Petroleum Development Act. The most important provision of this legislation is creating Petronas, the national oil corporation, and to make it the owner of the nation’s oil and gas. Enacted more than 40 years ago, it was a crucial part of Malaysia’s plan to take control of its hydrocarbon resources. The concession system in place at that time was not an ideal structure to build independence from foreign influence and control. With the introduction of the Act, timed somewhat with the production sharing system replacing concessions, local capability initiatives got off to a resounding start.
The new Act and the new production sharing system provided a better balance between developing the nation’s resources while benefiting from foreign led innovation and technology. An isolationist policy would not have benefitted the development of Malaysia’s resources as oil and gas is a global industry and foreign participation remains crucial. This continues to be reflected in Petronas’s guidelines for a licence. It sets out the requirements that foreigners would have to comply with before a licence can be issued.
Here is an infographic briefly showing the steps needed for foreigners to secure a Petronas licence, which is the doorway to Malaysia’s oil and gas industry.
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For more advice on Petronas licensing and oil and gas in general in Malaysia, please visit us at FTCC at www.ftcc.com.my or email queries or comments to email@example.com