corporate profile - petronas melaka group iii (mg3) base oil plant produces etro , one of the...

C O R P O R A T E P R O F I L E | 1

CORPORATE PROFILE

Petroliam Nasional Berhad (PETRONAS) Company No. 20076-K

Registered Office: Tower 1, PETRONAS Twin Towers

Kuala Lumpur City Centre, 50088 Kuala Lumpur, Malaysia

Telephone: +603 2051 5000

Fax: +603 2026 5050

www.petronas.com

2 | C O R P O R A T E P R O F I L E

PETRONAS, the national oil company of Malaysia has,since its establishment on17 August 1974, transformed from being a mere manager and regulator of the country’s upstream sector to become an integrated oil and gas multinational corporation. Ranked on the FORTUNE Global 500®, the PETRONAS Group has ventured into more than30 countries.

PETRONAS - A Leading Oil and GasMultinational of Choice

Much of PETRONAS’ success can be attributed to our ability

to strike a balance between being a state-owned entity and a

full-fledged commercial organisation. As a state-owned entity,

PETRONAS is responsible for the effective management of

Malaysia’s oil and gas resources, to add value to this national

asset and to ensure the orderly and sustainable development

of the country’s petroleum industry. Meanwhile, as a business

entity, we conduct our operations in the most prudent and

commercial manner to compete effectively in the increasingly

challenging global business environment, while maximising

returns to our shareholders.

PETRONAS has, since the early 1990s, embarked on a

strategic globalisation programme to augment Malaysia’s

crude oil and gas reserves, add value to our core business and

provide exciting new challenges for our young employees.


3

Who We Are 2-3

Financial Track Record 3

Our Business Operations 4-5

Exploration & Production

Business 6-7

Oil Business 8-9

Gas Business 10-11

Petrochemical Business 12-13

Logistics & Maritime Business 14-15

Technology Development 16-17

On the Fast Track - Motorsports 18-19

Our Corporate Sustainability Initiatives 20

•HSE 21

•OurPeople 22-23

•ContributionstoSociety 24-25

Table of Contents


With a proven track record in integrated petroleum operations and a strong commitment to make meaningful contributions to the host countries wherever we operate, PETRONAS is being increasingly accepted as a preferred strategic partner.

www.petronas.com

www.petronastwintowers.com.my

Financial Track Record (financial year ended 31 March)

005 06 07 08 09

05 06 07 08 09 0605 07 08 09

05 06 07 08 09

20

40

60

80

0

10

20

30

40

50

60

0

25

50

75

100

125

0

4

8

12

16

20

31.5

39.9

49.7

63

63.5

62.9 74

.1 85.2

106

106.

1

9.4 11

.4 12.9

18.1

15.3

36.1 44

.4

51

66.2

77

REVENUE(Year - USD billion)

SHAREHOLDER’S FUNDS(Year - USD billion)

TOTAL ASSETS(Year - USD billion)

NET INCOME(Year - USD billion)

Calculated at USD1 = RM3.7995 for FY2005, USD1 = RM3.7688 for FY2006, USD1 = RM3.6100 for FY2007, USD1 = RM3.3690 for FY2008 and USD1 = RM3.4318 for FY2009


As a fully integrated oil and gas multinational, PETRONAS is

involved in the entire spectrum of petroleum activities. From

managing the work of foreign production sharing contractors,

we have evolved into developing our own capabilities in

the upstream sector - enabling us to take the lead in the

exploration and production of the nation’s oil and gas resources.

To maximise the value of this national asset, we have ventured

into a comprehensive range of downstream activities.

We seek to maximise value creation and strengthen the

integration of our operations all the way down the value chain.

Our Business Operations


The range of our downstream activities includes:

• Oil refining

• Marketing and distribution of petroleum products

• Trading

• Gas processing and liquefaction

• Gas transmission pipeline operations

• Marketing of liquefied natural gas

• Petrochemical manufacturing and marketing

• Shipping

• Property investment

We continue to expand our businesses both in Malaysia

and overseas as we journey towards realising our vision

“To be a Leading Oil and Gas Multinational of Choice”.

With our strategy of integration, adding value and globalisation, PETRONAS continues to chart new paths and deliver excellent performance for our stakeholders, our employees, our nation, and our host countries and communities where we operate.


Our capability and track record of successful offshore

developments in oil and gas have earned us the operatorship

in many ventures and enabled us to expand our operations

overseas.

As at 31 March 2009, we have 66 international upstream

ventures in 22 countries, a demonstration of the relationships

we have built with host nations and a cherished recognition

of our E&P capabilities.

We continue to harness and build new technologies

to maximise opportunities and further strengthen our

capabilities in aspiring to become a leader in niche technology

development and application in geoscience.

New developments in deepwater E&P in the country have

opened up new opportunities for growth. PETRONAS

actively supports Malaysia’s aspiration to become a regional

deepwater hub.

PETRONAS is focused on enhancing the value of and increasing Malaysia’s oil and gas reserves by promoting and undertaking exploration and production (E&P) activities within the country and securing new acreage overseas.

In addition to increasing the prospectivity of our domestic

acreages, our E&P subsidiary PETRONAS Carigali Sdn

Bhd works alongside a number of multinational petroleum

companies in production sharing contracts (PSC) to

explore, develop and produce oil and gas in Malaysia.

Exploration & Production Business


QUICK FACTS

• Malaysia’s hydrocarbon reserves stand at 20.18 billion barrels

of oil equivalent (boe) with average production of 1.66 million

boe per day.

• PETRONAS’ total hydrocarbon reserves stand at 27.02 billion

boe with average production of 1.80 million boe per day.

• International reserves in Africa, Southeast Asia, the Middle

East and Central Asia stand at 6.84 billion boe, a

quarter of PETRONAS’ total reserves.

• PETRONAS achieved Reserves Replacement Ratio of 1.1

times in Malaysia and 4.1 times internationally, amongst the

highest in the industry.

• Malaysia’s first deepwater field, Kikeh, employing the first

Truss Spar floating production unit outside the Gulf of Mexico

came onstream in August 2007. The project achieved

world-class performance with only five years from discovery

to production.

* Reserves figures are as at 1 January 2009 and average production figures are for financial year ended 31 March 2009.


PETRONAS realises and adds value to its crude oil resources through refining, trading, marketing and retailing activities. We own and operate four refineries with a total refining capacity of about 448,000 barrels per day. Our crude oil marketing and trading activities span the globe and our portfolio includes a range of significant grades from various regions. We operate service stations incountries including Malaysia, South Africa, Sudan, Thailand and Indonesia. PETRONAS also conducts the production, marketing and distribution of automotive and industrial lubricants globally,

Oil Business


including the PETRONAS Syntium and Sprinta premium grade engine oils. We are also involved inaviation and liquefied petroleum gas (LPG) businesses.QUICK FACTS

• PETRONAS owns and operates three oil refineries in Malaysia-

two in Melaka*, one in Kertih. Our subsidiary Engen Ltd owns

and operates a refinery in Durban, South Africa.

• Our domestic refineries are highly regarded in terms of

operational excellence, ranking in the top quartile for refinery

utilisation in the Solomon benchmarking exercise within Asia

Pacific for six consecutive years, as well as winning various

Health, Safety and Environment (HSE) awards.

• Our retail subsidiaries PETRONAS Dagangan Berhad and

Engen Ltd are market leaders in Malaysia and South Africa

respectively.

• The formation of PETRONAS Lubricants International,

following our acquisition of Italy’s FL Selenia SpA, Europe’s

largest independent producer and marketer of automotive

lubricants and specialist fluids, boosts our global presence

with a vast operations network across Europe, South America

and USA.

• LPG terminalling, bottling and distribution activities are

carried out in India, Malaysia, the Philippines and Vietnam.

• PETRONAS Melaka Group III (MG3) Base Oil plant produces

ETRO™, one of the world’s highest quality base oils used

in the production of top-tier automotive and industrial

lubricants.

*The PSR-2 refinery is co-owned with ConocoPhillips (47%)

www.mymesra.com.my www.engen.co.za

1 0 | C O R P O R A T E P R O F I L E

PETRONAS has achieved the reputation of a trusted and reliable partner in the supply of natural gas domestically and internationally. Our liquefied natural gas (LNG) business is expanding further as we venture into unconventional gas with a joint venture to develop and operate a coal seam gas-to-LNG project in Australia with first cargo scheduled for 2014.

Gas Business

C O R P O R A T E P R O F I L E | 1 1

• Our acquisition of Star Energy plc enables us to expand and

strengthen our position in the gas storage sector in the UK

and Europe.

• PETRONAS has interests in more than 10,000 km of natural

gas pipelines worldwide, including in Thailand, Indonesia,

Australia and Argentina.

• PETRONAS promotes the use of gas fuel for a cleaner

environment and operates the only Natural Gas for Vehicles

(NGV) service stations in Malaysia.

In Malaysia, PETRONAS developed the Peninsular Gas Utilisation

(PGU) pipeline system to meet the nation’s energy needs by

supplying processed gas through a more than 2,500 km trans-

peninsular gas transmission pipeline. As part of the ASEAN

Council on Petroleum (ASCOPE), PETRONAS champions the

creation of the Trans-ASEAN Gas Pipeline (TAGP) by 2020 to

provide energy security and supply in the region.

QUICK FACTS

• The PETRONAS LNG Complex in Bintulu, Sarawak is one

of the world’s largest LNG production facilities at a single

location with a combined capacity of about 23 million tonnes

per annum.

• We are one of the largest equity owners of LNG production

capacity in the world and have delivered over 6,000 cargoes

on time and without fail since 1983.

• PETRONAS’ LNG business has expanded from our traditional

Far East markets to the Atlantic Basin, with interest in the

integrated Egyptian LNG project and the Dragon LNG

regasification terminal in the UK.


PETRONAS’ venture into the petrochemical industry adds further value to the nation’s gas resources. We partner foreign multinational companies to acquire the best petrochemical expertise and technological know-how. With adequate feedstock via the PGU pipeline, PETRONAS is positioning Malaysia to be a competitive petrochemical hub with the establishment of two integrated petrochemical complexes (IPCs) with superior logistics and infrastructurecapabilities.

Petrochemical Business


• PETRONAS’ subsidiary, Malaysian International Trading

Corporation Sdn Bhd (MITCO), markets and trades our

petrochemical products to both Malaysian and international

customers.

• Our Mega Methanol project in Labuan is among the largest

methanol plants in the world with a capacity of 1.7 million

tonnes per year.

• Overseas, PETRONAS owns and operates the Phu My

Plastics & Chemical Company Ltd in Vietnam.

Our Petrochemical Products include:

Acetic Acid

Acrylic Acid

Ammonia

Benzene

Carbon Monoxide

Ethylene

Ethylene Glycol

www.mitco.com.my

The Kertih Integrated Petrochemical Complex and the Gebeng

Integrated Petrochemical Complex provide ready sites for

petrochemical plants with the provision of industrial gases and

utilities via the Centralised Utility Facilities, ports and a railway

link for a more efficient delivery system. Since 1992, the IPCs

have grown to become home to more than 20 petrochemical

plants. PETRONAS is also promoting the plastics manufacturing

sector by developing the Kertih Plastics Park to take advantage

of readily-available feedstock from the adjacent IPC.

QUICK FACTS

• PETRONAS produced a total of 9.2 million tonnes of

petrochemical products in financial year ended 31 March

2009.

• Major petrochemical players that partner with us include

BASF, Dow Chemical Company, BP Chemicals, Idemitsu and

Sasol.

• The two IPCs are served by three ports - Kertih, Kemaman

and Kuantan ports - and are linked by the Kertih-Kuantan

Railway System.

Ethylene Oxide

Methanol

Methyl Tertiary Butyl Ether(MTBE)

Oxogas

Paraxylene

Polyethylene

Polypropylene

Polyvinyl Chloride (PVC)

Propylene

Styrene Monomer

Urea

Vinyl Chloride Monomer (VCM)


Its wholly owned subsidiary, Malaysia Marine and Heavy

Engineering Sdn Bhd (MMHE), is committed to becoming a

leading marine and heavy engineering organisation.

QUICK FACTS

• MISC is a leading provider of energy transportation in the

world, with more than 25 years of proven experience in LNG

transportation.

• MISC’s petroleum business is undertaken by AET Inc Ltd,

the No.1 lightering service provider in the US Gulf and now

has global reach through regional hubs in Houston, Kuala

Lumpur, London and Singapore.

• MISC has its own world-class training academy - Malaysian

Maritime Academy (ALAM) - dedicated to producing highly

qualified graduates for the maritime industry.

MISC Berhad is PETRONAS’ shipping subsidiary, adding value to our energy business by providing us with reliable transport and logistics support as well as the flexibility to trade our products in wider markets. Its relatively young fleet of more than 100 vessels, with a combined tonnage totalling more than eight million dwt, confidently traverses the globe, calling at most major ports around the world.

Logistics & Maritime Business


• MMHE fabricated the Truss Spar floating production unit

and the Floating Production, Storage and Offloading (FPSO)

facility for the Kikeh Development Project - Malaysia’s first

deepwater development.

Fleet numbers by business (as at 31 March 2009)

LNG carriers 29

Petroleum tankers 45

Chemical tankers 17

FPSO/FSO 9

Liner 19

Total 119

www.misc.com.my


As technology is a crucial part of growth within the oil and gas industry, PETRONAS pursues technological development with great enthusiasm. Through innovation, we have added value in the areas of E&P, lubricant development and automotive engineering.

A key area in addressing the world’s energy needs is in

developing technologies to increase our hydrocarbon resources

and to enhance the productivity and recovery of each field.

As Malaysia’s oil and gas discoveries are made in increasingly

deep waters, we are excited about exploring this new frontier.

Technology Development


In the downstream sector, we also look towards innovation to

maximise throughput and yield in the oil, gas and petrochemical

sectors. By improving our processes, facilities and materials, we

will continue to achieve higher levels of operational excellence.

At the same time, as quality standards and demand for new

applications increase, PETRONAS is already looking into our

range of petroleum, polymer and special products to meet the

needs of a fast-evolving world. Through strategic alliances with

world-class institutions, we are also developing a renewable

energy laboratory.

We are committed to investing in research and development to

develop niche technologies.

QUICK FACTS

• Our E&P arm, Carigali, has pioneered the use of world’s-first

technologies, among which are sand control and clearing

organic solids from production tubing.

• Malaysia’s first deepwater development project, Kikeh,

utilises Truss Spar technology, the first outside of the Gulf

of Mexico and fabricated by our subsidiary MMHE. FPSO

Kikeh, also fabricated by MMHE, has the largest and heavist

external turret in the world.

• We installed the world’s first onshore mercury management

system to treat raw condensates, eliminating possible HSE

and operational hazards.

• Our top-of-the-range fully-synthetic passenger car lubricant,

Syntium 5000, meets the highest Original Equipment

Manufacturers (OEM) specifications and API standards.

• The ECOPLUS™ range of environmentally-degradable

polymers developed by PETRONAS is an innovation in the

manufacturing process of degradable plastic resin.

• From our involvement in Formula One, we have gained

automotive engineering technology, resulting in the successful

development of the PETRONAS EO1 engine, currently being

developed for commercial use.

• PETRONAS researchers have also successfully applied Green

Chemistry in the removal of mercury from hydrocarbons and

in the treatment of low quality crudes.

• We developed a new catalytic conversion process in the

MG3 plant, currently one of only 10 such plants in the world

producing top-tier Group III base oil.


PETRONAS has been involved in motorsports for over two decades, an association that includes more than a dozen years at the pinnacle of motor-racing, Formula One. Our involvement in motorsports has proven to be an effective platform for the research, development and promotion of PETRONAS’ fuel and lubricant products, allowing further expansion of the Group’s downstream retail business.Motorsports has also given PETRONAS the opportunity

On the Fast Track - Motorsports


to supplement and enhance our technological and human capabilities.

PETRONAS’ involvement in motorsports includes:

• Formula One: As an extension of our relationship with the

Sauber Formula One Team since 1995, PETRONAS is the

Premium Partner to the BMW Sauber F1 Team in the 2009

FIA Formula One World Championship.

• Motorcycle Racing: FIAT-YAMAHA TEAM in the FIM Road

Racing World Championship Grand Prix or MOTOGP and the

PETRONAS SPRINTA YAMAHA Racing Teams in the national

and regional motorcycle racing championships.

• Endurance Racing: PETRONAS SYNTIUM TEAM in the

Japanese Super Taikyu Endurance Series.

• GT Racing: LEXUS TEAM PETRONAS TOM’S in Japan’s

Super GT Series.

• Formula Racing: PETRONAS TEAM TOM’S in Japan’s

premier Formula racing categories; the Formula Nippon and

All Japan Formula 3 Championships.

• Formula BMW: TEAM HOLZER PFX, racing in the entry-level

single-seater Formula BMW series.

• Driver Development: PETRONAS FORMULA XPERIENCE

racing school to train, nurture and develop young racing

talents in open-wheel single-seater racing.

PETRONAS is the title sponsor of the PETRONAS Malaysian

Formula One Grand Prix at the Sepang International Circuit,

the PETRONAS AAM Malaysian Cub Prix Championship, the

PETRONAS FIM Asia Road Racing Championship motorcycle

series, as well as the Merdeka Millennium Endurance race.

www.petmos.com.my


In line with our commitment to continuous growth and sustainable development for the future, PETRONAS works in the best possible way to balance and integrate economic, environmental and social considerations into our business decisions. These considerations include among other things strongHSEmanagementandperformance, continuous development of our people, and our long-term and holistic contribution to society.

Our CorporateSustainability Initiatives


HEALTH,SAFETYANDENVIRONMENT(HSE)As a responsible corporate citizen, PETRONAS is

uncompromisingly committed to responsible HSE management

practices in every aspect of our operations.

We endeavour to ensure that the facilities we design, build and

operate, the products we manufacture and the services we

provide are in accordance with appropriate legal requirements,

industry standards and best practices. We carry out regular

programmes to ensure that our employees and contractors,

communities in the areas we operate, and the public in general

are educated on HSE issues.

The well-being of our employees and contractors is a major

area of concern. Significant efforts have been made to

improve safety in the workplace and offsite, resulting in strict

compliance with our health and safety standards across the

Group’s operations.

PETRONAS has also taken proactive steps towards the

conservation and preservation of the environment. Among the

measures we are committed to is the reduction of greenhouse

gas emissions. Through the use of cogeneration units fuelled by

natural gas, we pursue energy efficiency, and have implemented

the Energy Loss Management System at our plants to further

reduce energy wastage.

Throughout the years, we have garnered many national and

international HSE awards by maintaining operational excellence.

We share HSE best practices and lessons learnt across the

Group to further our culture of continuous improvement.

Our CorporateSustainability Initiatives


PETRONAS’ stature as a multinational corporation is reflected in our workforce composition of nationals from 28 countries. As a FORTUNE Global 500® company, we employ the best and the brightest. As an employer, our joy is in seeing our employees live up to their potential.

OUR PEOPLEPETRONAS’ Human Resource Management Division works

hand-in-hand with the Education Division to grow our human

capital. Compulsory skills training and e-learning modules are

made available to cultivate a culture of continuous learning

within the Group.

As a player in a technically-driven industry, we strive to

harness the capability and potential of our technical personnel.

The establishment of the Technical Trade Specialist scheme

provides career development opportunities for highly skilled

and experienced operators and technicians to progress further

within the organisation. Young engineers, meanwhile, are

nurtured via the Technical Professional Career Progression

programme, fast tracking their learning and development into

leaders in their respective areas of expertise.

Our Corporate Sustainability Initiatives > continued


Leadership development is a serious undertaking within

PETRONAS, and staff are encouraged to step up to the plate

and take on new challenges to hone their managerial skills.

Employees who demonstrate potential are given exposure

through job rotation and international assignments, while the

leadership-opportunity matching process also encourages

staff to move upwards in the organisation. We believe that

improving the quality of our human capital will help the country

to achieve its vision of becoming a developed nation.

www.discoverpetronas.com


In striving to enrich the lives we touch, our social investments focus stronglyon education as a means of self-improvement.

The programmes we support cover a full range of human development, including health, the environment, science and technology, arts and culture, and sports. www.utp.edu.my

www.alam.edu.my

www.petrosains.com.my

www.mpo.com.my

CONTRIBUTIONS TO SOCIETYOur community programmes include:

• Tuition and motivational sessions for underprivileged

schoolgoing children through the Program Bakti Pendidikan

PETRONAS.

• Setting up education institutions such as Universiti Teknologi

PETRONAS (UTP), Institut Teknologi PETRONAS (INSTEP)

and Malaysian Maritime Academy (ALAM).

• Awarding scholarships and education grants annually to local

and international students from our host nations to promote

study in various disciplines, especially engineering and

geosciences.

• Creating awareness and encouraging interest in science and

technology through the establishment of the PETROSAINS

Discovery Centre and the interactive road safety mobile

exhibition StreetSmart.

• Promoting appreciation of world-class cultural experiences

through the cultivation of our own PETRONAS Performing

Arts Group, art exhibitions at GALERI PETRONAS, and the

renowned Malaysian Philharmonic Orchestra in residence at

Dewan Filharmonik PETRONAS.

Our Corporate Sustainability Initiatives > continued


• Contributed towards urban renewal projects like KLCC Park,

Putrajaya Wetlands and sponsorship of Zoo Negara.

• Engaging in medical research by supporting the establishment

of Malaysia’s Cancer Research Initiatives Foundation (CARIF)

and delivering healthcare to rural areas with our Mobile

Eye Clinic in collaboration with the Tun Hussein Onn Eye

Hospital.

• Community welfare projects for the underprivileged.

• Humanitarian relief efforts through the PETRONAS Volunteer

Opportunity Programme (PVOP), in areas devastated by

floods, earthquakes and cyclones.

• Sports development and promotion by partnering with the

Malaysian Basketball Association (MABA), and sponsoring

events like Sukan Malaysia (SUKMA) and Le Tour de

Langkawi.

• Community relations projects in the countries we operate

in to provide basic needs like safe drinking water, shelter,

healthcare and skills training.


G

For further information on PETRONAS, please contact:

Group Corporate Affairs

Legal & Corporate Affairs Division

Level 70, Tower 1, PETRONAS Twin Towers

Kuala Lumpur City Centre, 50088 Kuala Lumpur, MALAYSIA

Tel: + 603-2051 5000

Fax: + 603-2026 5050

www.petronas.com

©2009PETROLIAMNASIONALBERHAD(PETRONAS)

All rights reserved. PETRONAS makes no representation or warranty, whether express or implied, as to the accuracy or

completeness of the facts presented. PETRONAS disclaims responsibility from any liability arising out of reliance on

the contents of this publication.

This brochure is updated and published yearly. All information is correct as at March 2009.


G


CORPORATE PROFILE

Petroliam Nasional Berhad (PETRONAS) Company No. 20076-K

Registered Office: Tower 1, PETRONAS Twin Towers

Kuala Lumpur City Centre, 50088 Kuala Lumpur, Malaysia

Telephone: +603 2051 5000

Fax: +603 2026 5050

www.petronas.com

corporate profile - petronas melaka group iii (mg3) base oil plant produces etro , one of the...

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