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3 janvier 2013

Pakatan May Cut Petronas’ Yearly RM30b Dividend to Putrajaya

KUALA LUMPUR, Dec 24 – Opposition Leader Datuk Seri Anwar Ibrahim will push Petronas to cut its annual RM30 billion dividend to Putrajaya if the Pakatan Rakyat (PR) that he leads win in the coming general elections, business newswire Bloomberg.com reported today.

PR will instead set Petronas’ dividends to the country at a fixed percentage of the firm’s profits, allowing the state oil firm to spend more on investments overseas that will give better profits, PKR strategic director Rafizi Ramli said.

“Petronas should be left to run on a purely commercial basis,” he told Bloomberg when explaining Anwar’s plans.

According to Bloomberg, a PR administration is likely set up a parliamentary committee in Malaysia’s Dewan Negara to improve transparency over Petronas, which currently reports to the prime minister.

Petronas is widely-regarded as the country’s piggy bank, with Reuters reporting this July that it is Malaysia’s largest taxpayer and biggest revenue source, funding 45 per cent of the government’s budget even as the country’s continues its run of huge budget debts.

Petronas chief executive officer Shamsul Azhar Abbas had, in September, said the firm should change its current model of paying RM30 billion annually to Putrajaya and pay 30 per cent of its profit instead, Bloomberg reported.

Another key policy change by PR to boost the country’s oil reserves and revenue will be to get Petronas to buy more oil blocks overseas and cut down on exploring small local oil sites.

PR reportedly said that this overseas investment approach could be a better way to gain more from the RM300 billion that Petronas will be spending over the next five years.

“There’s a higher probability you’ll strike bigger reserves should those resources be deployed to discover oil blocks overseas.

“We’ll lose out in the long-term from opportunity lost, especially when the Chinese are particularly agressive in acquiring blocks around the world,” Rafizi said in an interview with Bloomberg last Tuesday.

During Prime Minister Datuk Seri Najib Razak’s leadership, Petronas has been offering tax incentives and production-sharing deals to attract international oil explorers to survey local offshore sites or marginal fields for oil.

In November 2010, Najib said that exploration of these marginal fields could generate oil revenue of over RM50 billion spread out over the 20 years to come, Bloomberg reported.

But Rafizi explained that the current approach by Putrajaya is “very short-term”.

“It’s not a question of finance, it’s about the time and manpower resources. The potential for huge discovery is actually quite limited,” Rafizi said, with Bloomberg pointing out that he had previously worked in Petronas’ business planning unit.

Andrew Harwood, an analyst from consulting group Singapore’s Wood Mackenzie Ltd, agreed with Rafizi, saying: “It makes sense for the national oil company to be pushing the boundaries of exploration.

He said that by doing so, Petronas would be “using its resources to go after the substantial plays, while leaving the small and understood areas to other companies”.

Victor Shum, a consultant from Singapore, said Petronas should be exploring both local “marginal fields” and “buying blocks abroad”.

“It’s about which opportunities are likely to be more successful and cost-efficient. They need to explore the fields to find out,” the managing director of IHS Consultant told Bloomberg.

According to Bloomberg, the Finance Ministry has said that Malaysia’s oil reserves will last 29 years, while the country’s gas reserves will last 37 years.