KUALA LUMPUR, Aug 20 – Petronas plans to continue to maintain its cost-saving measures and do not choose to lay off workers and selling assets to weather the bleak scenario in the oil and gas right now. Senior Vice President of Corporate Strategy and Risk Adif Zulkifly said so far Petronas has managed a budget of RM640 million by optimizing logistics.
“This is very encouraging which there are some cost-saving initiatives that will be implemented again,” he said during a keynote address at the East Asia Summit 2015 moderated by Kevin Plumberg, Senior Editor of The Economist, publications based in Britain.
Despite the gloomy outlook for global oil prices, Adif said Petronas would provide at least $ 50 billion a year for capital expenditure, which is where the majority of the funds will be channeled to development projects integrated refining and petrochemical (RAPID) in Pengerang.
“The current global oil price is around US $ 47 a barrel will not rise sharply but the big shock in demand. We are now facing the problem of oversupply. Last time we faced this situation, the industry took almost five years to recover. The current situation (lower global oil prices) is expected to remain for a while,” he said.
He said he were only expect a modest recovery and has not returned to the level of US $ 100 per barrel. In addition to the oversupply, the weak outlook for the market due to excess inventory and adding storage capacity of about three million barrels of oil a day. However, Adif remain optimistic with state oil and gas companies nationwide saw this situation as an opportunity to be more disciplined in its spending by simplifying work processes and optimize operations.
