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Integrated Report 2024
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Dear Stakeholders,
Against a backdrop of persistent volatility that defined 2024, the PETRONAS Group remained steadfast in delivering our purpose. Across the world, intensifying geopolitical risks and ongoing conflicts further amplified the urgent need to reinforce energy systems and ensure security of supply. For PETRONAS, our Energy Transition Strategy remains a clear guide for the Group as we work to fulfil expectations of our stakeholders.
On behalf of the Board, I am proud to recognise the achievements of our people, whose invaluable dedication and commitment have delivered a strong performance for the year in review, strengthening our foundations to create long-term sustainable value for our stakeholders.
PETRONAS commemorated its 50th anniversary in 2024. The milestone coincided with a period of uncertainty in the global operating environment. Despite the challenges, the PETRONAS Board and Executive Leadership Team continued to steer the organisation towards its purpose to be a progressive energy and solutions partner. In doing so, our efforts were channelled towards ensuring security of supply and generating profitable long-term growth.
For the year in review, PETRONAS made the scheduled dividend payment of RM32 billion to the Government of Malaysia. As the sole contributor to the National Trust Fund, PETRONAS also continued to make its contribution of RM500 million in the same period, resulting in a cumulative RM13.5 billion contribution to the Fund as of 2024.
Since its establishment in 1974, PETRONAS has contributed RM1.5 trillion to the nation's economy, in the form of dividends, taxes, cash payments and others.
Even as we contend with the intensifying pressures in the industry, I am also pleased to note that PETRONAS, as a key driver of Malaysia’s National Energy Transition Roadmap, has stood resolute in delivering the targets under the Net Zero Carbon Emissions by 2050 Pathway, having successfully achieved our short-term emissions reduction target in 2024.
In that same vein, the Group also continued to uphold its commitment to pursue strengthened governance and compliance to meet the expectations of global stakeholders.
PETRONAS believes that true progress is achieved when organisations and communities grow together. Since inception, PETRONAS has collaborated with stakeholders and communities wherever we operate to deliver meaningful impact where it is most needed. For 50 years, the Group has remained closely attuned to societal development, tailoring our signature programmes to the demands of the era. In 2024, PETRONAS contributed RM700 million to more than 400 social impact programmes.
In the nascent years of Malaysia’s oil and gas industry, we focused on nurturing talent through education by introducing the PETRONAS Education Sponsorship Programme (PESP), which has benefitted 39,000 students since 1975. We also established the Institut Teknologi PETRONAS (INSTEP) and Universiti Teknologi PETRONAS (UTP), which has been recognised as the Number One university in Malaysia by the Times Higher Education World University Rankings.
Later, PETRONAS expanded its focus to uplifting societies through our Memampankan Ekonomi Asas Rakyat programme, providing access to necessities like water and electricity through the ‘Water for Life’ initiative and the installation of solar panels in rural areas. As our operations grew across borders, these initiatives were replicated and further customised to the needs of global communities.
In recent years, PETRONAS has introduced several environmental and social programmes, such as Rigs-to-Reef, mangrove conservation, the Imbak Canyon Conservation project, COVID-19 aid and flood relief. These efforts have had a lasting positive impact on Malaysians and local communities where PETRONAS operates.
PETRONAS has played a crucial role in shaping Malaysia’s oil and gas landscape. As a regulator, we nurtured a competitive ecosystem by introducing balanced fiscal terms in Production Sharing Contracts to grow the value pie. We also dutifully managed Petroleum Arrangement Contractors, and Oil and Gas Services and Equipment (OGSE) players to ensure compliance with high standards and governance.
Through the Vendor Development Programme (VDP) and VDPx, PETRONAS has supported 171 small and medium enterprise (SME) vendors since 1993, where 20 have successfully expanded their businesses into international markets. On the vendor financing front, 357 vendors have benefitted from RM2.2 billion in funding to expand their operations since the Vendor Finance Programme (VFP) was introduced in 2018.
Meanwhile, the PETRONAS Supplier Support Programme (PSSP) which was launched in 2024, aims to equip SMEs with sustainability capabilities and access to transition financing necessary to remain competitive in a low-carbon future. In the year under review, 417 vendors have enrolled in the programme.
At PETRONAS, we believe that sustainable growth is only possible when all industry players grow in tandem. With increased complexity in the macro environment putting downward pressure on margins, innovation and efficiency are foreseen to be key factors in project feasibility and profitability.
Moving forward, it will be more pivotal than ever that Petroleum Arrangement Contractors, OGSE players and technology providers strike mutually beneficial partnerships to jointly contribute to a progressive sector in Malaysia.
As we look ahead to 2025, we anticipate unrelenting volatility to persist with geopolitical shifts continuing to redefine the trade landscape and realign priorities in the energy transition. The industry is already responding to these shifts with sharpened focus on portfolio resilience, prudent financial management and strategic industry partnerships. In this regard, PETRONAS has put in place a series of transformative measures that will best position us to continue executing our Energy Transition Strategy, deliver long-term value to our stakeholders, and fulfil our purpose as a progressive energy and solutions partner.
With Malaysia assuming the chair of ASEAN in 2025, PETRONAS also looks forward to playing a part in strengthening regional collaboration to shape the future of energy for this region.
In closing, I would like to take this opportunity to thank Datuk Johan Mahmood Merican, Dato Haji Ibrahim Haji Baki and Datuk KY Mustafa for their exemplary leadership and contributions as members of the PETRONAS Board of Directors. I wish them every success in their future endeavours.
I would also like to extend a warm welcome to our new Board members namely, Datuk Dr Shahrazat Haji Ahmad and Datuk Seri Abdul Rasheed Ghaffour. Their vast experience and diverse perspectives will be invaluable in steering PETRONAS forward.
On behalf of the Board, I would like to record my heartfelt appreciation to Tan Sri Tengku Muhammad Taufik, President and Group CEO of PETRONAS, and his Executive Leadership Team for steering the Group towards delivering business strategies with agility and integrity. My deep appreciation also goes out to all employees for their sheer dedication and upholding of our Shared Values in discharging their duties.
Finally, I am grateful to our valued stakeholders, including the Federal and State Governments of Malaysia, our host countries, partners and customers for their continued trust and support. As we set forth in this next chapter, PETRONAS looks forward to building on these enduring partnerships to continue enriching lives in the next 50 years and beyond.
