PETRONAS should adapt to new energy transition demands amid economic and geopolitical uncertainties
Petroliam Nasional Bhd (PETRONAS) president and group chief executive officer (CEO) Tan Sri Tengku Muhammad Taufik Tengku Aziz speaking at Energy Asia 2025
KUALA LUMPUR: Petroliam Nasional Bhd (PETRONAS) must face new demands in the energy transition era to remain relevant amid current economic uncertainties and geopolitical tensions.
Its president and group chief executive officer, Tan Sri Tengku Muhammad Taufik Tengku Aziz, said that in the short term, hydrocarbon production must be cleaner and lower in carbon intensity to reduce greenhouse gas emissions, in addition to addressing methane leaks according to standards.
"Firstly, gold certification for oil and gas methane partnership (OGMP) 2.0 is a must. Secondly, we will avoid flaring or routine venting of gas, and so far, more than 20 of our assets have tackled this by practising zero routine flaring.
"In the medium to long term, offerings such as carbon capture and storage (CCS) and specialty chemicals should be accelerated as soon as possible, and I believe this requires the right platform, and investments need to be made,' he told Bernama TV in an exclusive interview during the Energy Asia 2025 conference here yesterday.
Tengku Muhammad Taufik highlighted that the national oil and gas company must undergo a transformation, where it is no longer optional but a necessity to prepare for a low-carbon energy system.
"In the past, we were production-oriented; we produced, and people would buy. Now, we need to understand more; we will only produce what people are willing to buy.
"Willing to buy in terms of capability and needs, so if it is just to supply energy in the form of liquefied natural gas (LNG) to traditional markets like Japan, perhaps now it is not enough,' he said.
Tengku Muhammad Taufik said PETRONAS is focusing on high-value assets and implementing strategic portfolio optimisation, including increasing or reducing holdings to optimise capital allocation, improve returns, and strengthen focus to support sustainable growth.
"Like any other energy player in the sector, optimising the portfolio is a mandatory activity and will always be practised.
"If this implementation requires us to sell assets with possibly higher carbon emissions and replace them with new assets that can extend the production life from the upstream sector, we will do that,' he said.
For the downstream sector, Tengku Muhammad Taufik said that if the divestment of assets causes margins to be affected, PETRONAS will replace them with assets that have more stable margins and are less exposed to uncertainties.
"This is where entities like Gentari come in, profits might be less, but it is less exposed to uncertainties,' he said.
Gentari is a clean energy solutions company, wholly owned by PETRONAS. - Bernama
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