Business

Petronas has 6 strategies to remain profitable

Syndicated News
Written by Syndicated News

KUALA LUMPUR — October 12, 2015: Petronas has outlined six strategies to tide over trying times in the oil and gas industry to stay profitable.
In an exclusive interview with the New Straits Times, Petronas president and group chief executive officer Datuk Wan Zulkiflee Wan Ariffin said that in the next few years, the national petroleum company should focus firstly on cash generation.

“What I mean by cash generation is our plants must be in tip-top condition — running all the time — and we must sell our products at the best value we can get, so it has to be all across the value chain,” he said in the interview, the first he has given to the press since heading Petronas in April.

Secondly, Petronas needs to deliver on its growth projects — the Refinery and Petrochemical Integrated Development (Rapid), the Floating Liquefied Natural Gas, more projects in Sabah and the project in Canada.

“We need to deliver these projects well — no cost overruns, and on time and with good health and safety levels.”

Wan Zulkiflee said the O&G projects that have already been sanctioned will go ahead, but the company would also ask for rebidding for some of the packages in the Rapid project to reflect the lower prices of raw materials.

Striking down costs and simplification is the third strategy.

“We are reviewing some of the processes across the group. These include human resource, procurement and planning processes.

“If we are able to simplify and reduce man-hours, the man-hours saved can instead be allocated for cash generation. These will be our short-term measures,” said the Penang-born Wan Zulkiflee.

Investing in technology, better talent management and improved work culture were the three other measures he had named.

Wan Zulkiflee, a 32-year veteran of Petronas, said the current tumultuous time provides a good window of opportunity to address all the inefficiencies within the organisation and also the local O&G industry.

He also said that Petronas, with a 51,000-strong workforce, has no immediate plans to lay off its staff, with some having been redeployed to the Rapid project. — Bernama

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