00:00Dato' Sazali Hamzah, Executive Vice President and CEO Downstream.
00:06My first question is, it seems there was a bit of slowdown in upstream activities last year,
00:11which companies partly point to long-term contract handovers and so on.
00:16Tan Sri, you showed us the capex numbers.
00:19If you can summarize your activity outlook, will activity levels this year improve?
00:24And just another one from me, for gas industry players,
00:29the development of a regasification terminal,
00:33is it an indication that these players can or should prepare for an open market soon?
00:40The answer to that is, yes, we expect to fulfill what we indicated in our petroleum activities outlook.
00:48What we saw last year was, as Lisa has outlined, a 41B capex,
00:53which was restrained and reined in because we needed to make sure
00:58the projects could be delivered economically and the returns hurdles would be cleared.
01:02And this is the kind of philosophy that I have intimated today.
01:07As we go forward, we need to make sure value accretion does manifest and does get realized.
01:13We have a duty to make sure as we monetize these hydrocarbons,
01:16the economic returns for Petronas and indeed the PACs that work with us are met.
01:22That is challenging going forward because, as I alluded,
01:27there is cost inflation meeting head-on with softening prices.
01:31Notwithstanding what you see as crises of security across the world,
01:36we have seen prices only range-bound moving between 65 to 72.
01:40There haven't been any real shocks because fundamentally,
01:44there appears to be supply adequate to meet demand in the near term.
01:48It's very positive for us.
01:51We continue to be robust in our expenditure.
01:55This is in line with our expansion growth in upstream in Malaysia and also beyond Malaysia.
02:03Yes, we do see a little bit of reduction in the aspiration of expenditure domestically,
02:11particularly we slice and dice by regions.
02:13We start to shift the aspiration of expenditure more towards the peninsular Malaysia side,
02:20trying to open up new geological play in those regions.
02:26In the eastern side of Malaysia,
02:31it is not lack of productivity,
02:34it is not lack of geological prospectivity.
02:38I think the current situation that has been prevailing over the past two years, three years,
02:42doesn't boat down well with the confidence of the investors.
02:46So it reflects the sentiment of the investors on the prevailing situation.
02:54So for Petronas, as far as upstream is concerned overall,
03:00we set our sights on expanding our international growth to about 60% over the next 10 years.
03:06So this is a way, this is very much on course,
03:13despite not continued capital discipline that we will continue to enforce.
03:18As we mentioned, I think there is a expectation of increasing energy demand in the peninsular Malaysia especially.
03:23I mean, growing middle income, increasing industrial base,
03:28we have got, you know, development of new data centres and AI,
03:32so that requires quite a bit of, quite a lot of energy, especially electrons.
03:38Given that our offshore supply is quite limited to a certain extent,
03:41there will be a need that we need to import more LNG.
03:44With that, I think there will be a requirement for a third RGT.
03:49And today, Petronas is working very closely with both Ministry of Economy and also with Surahan Jaya Tenaga.
03:55And we are giving our input, and then we are also giving in terms of, you know,
03:59the development of the RGT.
04:02Certainly, I think the path towards market research has always been in the works for quite some time now.
04:08Third party access has already been, you know, approved for quite a number of years now.
04:13What needed to spur this, you know, importation of LNG will be the full market liberalisation,
04:20which we expect by 2028, as per the latest projection that we hear from the government.
04:27So, we are all lining up for that.
04:29In the meantime, Petronas is out securing new supply to ensure that a new security for Malaysia is secured.
04:39So, I think those are some of the efforts that we are doing on our side
04:42to make sure that we have enough gas to supply to all our customers,
04:47both in the power and non-power sectors in Malaysia.
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