YB Rafizi: OGSE Industry is Facing its Next Opportunity with Energy Transition
KUALA LUMPUR, 19 OCTOBER 2023 – The oil & gas services and equipment (OGSE) industry is facing its next opportunity as the world focuses on the energy transition, said YB Mohd Rafizi Ramli, Minister of Economy.
“Not many people know that 85% of core OGSE companies in Malaysia are made up of SMEs. They face similar challenges to other SMEs: less access to capital, stiff competition with bigger players, shortage of talent and technology adoption. This is on top of the fact many OGSE players are still recovering from the long-term effects of the 2014 oil price crash and COVID-19.
“That is why OGSE players must embrace energy transition, as this will solve many of the issues being faced today,” he said in a speech delivered on his behalf by Dato’ Nor Azmie bin Diron, Secretary General, Ministry of Economy during the National OGSE Roadshow 2023 organised by Malaysia Petroleum Resources Corporation (MPRC).
He added that the National Energy Transition Roadmap launched this year outlined 10 flagship projects that will open up RM1.85 trillion in investment opportunities by 2050 with involvement from industry players such as Petronas, Gentari and Tenaga Nasional Berhad
“This is one of many efforts that open areas of collaboration for OGSE SMEs. It will facilitate decarbonisation and improve ESG governance,” he said, adding that OGSE companies must join in the effort to decarbonise to attract younger talent. He also urged OGSE companies to upskill its current workforce and ensure local OGSE talent did not move overseas.
“We must remember that OGSE is in the business of growth. By reshaping our business model through energy transition, I am confident the sector will continue to drive Malaysia’s economy forward - as it has done for many years,” he said.
Meanwhile, Mohd Yazid Ja’afar, President/CEO, MPRC, highlighted that the National OGSE Industry Blueprint (OGSE Blueprint) 2021-2030 had achieved encouraging progress since its launch in April 2021, including the provision of grants, fiscal facilitation, export promotion and talent development (See appendix for selected OGSE Blueprint highlights).
He also announced that MPRC, which coordinates the implementation of the OGSE Blueprint, would embark on a mid-term review of the programme next year, targeted for completion in 2025. He said the review was needed to ensure the OGSE Blueprint remained relevant and pragmatic in tackling the energy transition and other trends in the oil & gas and energy industry. He also called upon all OGSE industry stkeholders to continue working together to realise the potential and vision of the industry.
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APPENDIX – OGSE BLUEPRINT HIGHLIGHTS 2021-2023
- The approval of RM12.9 million in the OGSE Development Grant (OGSE DG) to 54 OGSE companies. OGSE DG is a matching grant of up to RM250,000 offered to eligible OGSE companies to adopt innovation and technology as well as to expand exports.
- The launch of MPRC’s Recognition of Prior Experiential Learning (RPEL) programme this year, where some 115 individuals are currently being retrained and certified for underwater welding and welding inspection at Advanced Technology Training Centre (ADTEC) Kemaman, ADTEC Shah Alam and Sarawak Skills
- Export promotion for 164 OGSE companies facilitated by MATRADE, providing them with access to potential sales exceeding RM2 billion.
- MIDA approved eight (8) multinational corporations (MNCs) for new or expansion of OGSE projects in Malaysia.
- TERAJU has provided RM25 million in grants to over twenty (20) OGSE companies through its Dana Kemakmuran Bumiputera, catalysing a projected RM250 million in investments.
- TalentCorp has engaged with hundreds of Malaysian diaspora in OGSE to help reverse the brain drain, while also working with other OGSE ecosystem players to provide the six-month #Walkwithme OGSE industry coaching programme, which has so far mentored over three hundred (300) participants towards propelling their career trajectories in OGSE.
About MPRC Established in April 2011, Malaysia Petroleum Resources Corporation (MPRC) is an agency of the Ministry of Economy tasked with advancing Malaysia's Oil and Gas Services and Equipment (OGSE) sector. MPRC also provides policy recommendations to the Government in the oil, gas, and energy industry. As countries the world over, including Malaysia, embark on the energy transition, MPRC further advocates for OGSE companies to pivot towards cleaner and sustainable renewable energy as new areas for business growth.
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