MALAYSIA NOTES PETROLEUM SECTOR PROGRESS

Malaysia plans to boost its share of the liquefied natural gas market this year. At the same time, the country expects to maintain its oil production at the same level it had during the Persian Gulf war. Private investment, expected to play a greater role in Malaysia's upstream oil sector, is expanding downstream as well. Foreign companies have disclosed new joint ventures in petrochemicals and lubricants marketing.
June 24, 1991
3 min read

Malaysia plans to boost its share of the liquefied natural gas market this year.

At the same time, the country expects to maintain its oil production at the same level it had during the Persian Gulf war.

Private investment, expected to play a greater role in Malaysia's upstream oil sector, is expanding downstream as well.

Foreign companies have disclosed new joint ventures in petrochemicals and lubricants marketing.

Private investment in Malaysia's oil sector, covering upstream and downstream activities, jumped to $2 billion in 1990 from $1.5 billion in 1989. The investment trend is expected to continue in the 1990s, government officials said.

UPSTREAM PLANS

Malaysia intends to increase LNG production to 8.06 million metric tons/year in 1991 from 6.7 million tons/year in 1990, Japan's Kyodo News Service reported. Kyodo did not report how the increase is to be accomplished. Malaysia has been shipping LNG to Tokyo Elec-tric Power and Tokyo Gas since 1983. Early this year Petronas Marine, a unit of state owned Petroleum Nasional Bhd. (Petronas) placed a $1.4 billion order with French shipbuilder Chantiers de l'Atlantique for five 130,000 cu m capacity LNG tankers (OGJ, Feb. 25, p. 32).

At the same time, the government is pressing increased domestic use of natural gas. It predicts gas will meet more than 51% of Ma-laysia's power generation needs by 1995.

Malaysia also plans to maintain current oil production of 600,000 b/d through 1991, underpinning a reserves life of 13 years.

The country projects revenue from crude exports of $3.8 billion in 1991, compared with $3.7 billion in 1990. Malaysia hiked produc-tion by about 1 0,000 b/d from 590,000 b/d during the Persian Gulf war.

PETROCHEMICAL VENTURES

Petronas signed joint venture agreements with ldemitsu Petrochemical Co. and BP Chemicals Co. for a 320,000 metric ton/year ethylene plant and a 200,000 metric ton/year polyethylene plant at Terengganu on the eastern coast of Malaysia.

Start-up of both plants is scheduled for mid-1995.

Interests in the ethylene plant will be Petronas 60%, ldemitsu 25%, and BP 15%.

Ownership of the polyethylene plant will be BP 45%, Petronas 40%, and ldemitsu 15%.

LUBRICANTS VENTURES

Pennzoil Products Co. set up two joint venture companies with Malaysia's UMW Auto Parts Ltd. to blend and market Pennzoil lubricants, establishing Malaysia as its regional base for the Asia--Pacific region.

Lubetech Ltd., owned 70% by UMW and 30% Pennzoil, will operate a $900,000 lubricant blending plant with initial production capacity of 10 million l./year at UMW's Kuala Lumpur complex. Start-up is expected by the end of June.

UMW Pennzoil Distributors Ltd., owned 50-50 by UMW and Pennzoil, will market and distribute the lubricants.

Copyright 1991 Oil & Gas Journal. All Rights Reserved.

Sign up for Oil & Gas Journal Newsletters