Who spark Oil and Gas industry in Malaysia?
PETRONAS was not the first company to extract
oil or gas in Malaysia. It was Royal Dutch Shell that
began the oil exploration in Sarawak, then under the White Rajahs, at the end of the 19th century. In 1910, the
first oil well was drilled in Miri, Sarawak. This became the first oil
producing well known as the Grand Old Lady. Shell was still the only oil
company in the area in 1963, when the Federation of Malaya,
having achieved independence from Britain six years before, united with Sarawak
and Sabah, both on the island of Borneo, and became Malaysia. The authorities
in the two new states retained their links with Royal Dutch Shell, which
brought Malaysia's first offshore oil field onstream in 1968.
Meanwhile, the federal government turned to
Esso, Continental Oil, and Mobil, licensing exploration off the
state of Terengganu, in the Malay Peninsula, the most populous region
and the focus of federal power. By 1974, however, only Esso was still in the area. It made its
first discoveries of natural gas in that year and then rapidly made Terengganu a
bigger producer of oil than either Sarawak or Sabah.
By 1974, Malaysia's output of crude oil stood at about 81,000 barrels per day
(12,900 m3/d).
The Government of Malaysia contributes
significantly towards policy and macro-economic planning to secure a
sustainable and long-term success of the oil and gas industry. The Government’s main objective is to increase aggregate production capacity by
five per cent every year up to 2020 to meet domestic demand growth while
sustaining crude oil and LNG exports to overseas markets. In the Asia Pacific
region, Malaysia aims to be the number one oil and gas hub by 2017, taking
advantage of its strategic location at key shipping lanes as well as strong
economic fundamentals in China, India and within Southeast Asia.
In Malaysia, energy policy for the upstream
sector is determined by the Economic Planning Unit (EPU) and the Implementation
and Coordination Unit (ICU), both of which reports directly to the Prime
Minister. The Government focuses on efforts to enhance output from existing oil
and gas fields, new marginal fields as well as exploration and development
opportunities in deep-water areas. To this end, new tax and investment
incentives under Petroleum Income Tax Act (PITA) were introduced in 2010 to
promote oil and gas exploration activities.
