Malaysia still tops in Asian O&G Sector

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Malaysia’s oil and gas industry remains a vibrant and growing one (photo credit: PETRONAS)Malaysia’s oil and gas industry remains a vibrant and growing one (photo credit: PETRONAS)Malaysia’s oil and gas industry remains a vibrant and growing one (photo credit: PETRONAS)

Despite the Malaysian federal government’s gradual reduction of reliance on oil and gas (O&G) revenues, and the sector’s decreased contribution as a percentage of GDP, the industry remains a vibrant and growing one, if the numbers of professionals who attended the recently-concluded Oil & Gas Asia 2015 (OGA2015) expo is anything to go by. Held biennially, this year’s OGA2015 saw a record-breaking 23,414 attendees over its 3-day length at the Kuala Lumpur Convention Centre, an increase of 6.2% over OGA2013’s 22,049 visitors.

Present at the expo was the Malaysia External Trade Development Corporation (MATRADE), Malaysia’s national trade promotion agency, which had set up an incoming buying mission. By the second day of the expo, MATRADE had achieved RM76.4 million in sales, exceeding its target of RM50 million.

The expo also brought exhibitors from all over the world; many of whom were set up in country-specific Pavilions. Alan Henderson from Scottish Development International (SDI), the trade and investment arm of the Scottish government and lead coordinator of the Scottish Pavilion, says that SDI has been coming to Malaysia for nearly 15 years now (for the various OGAs), bringing one of their biggest delegations of 21 companies to OGA2015. He added that while SDI is focusing on Asia as a whole, it understood that Malaysia and Kuala Lumpur is the hub for the technologies that are required for the region.

“Our role is to promote trade – coming from Scotland, but also to look for inward investment to Scotland. Because of the length of time the industry’s been going in Scotland, we have a lot of expertise in deepwater drilling, subsea technologies, asset integrity and also with hazardous conditions, so a lot of that expertise is now applicable to the Malaysian and the Southeast Asian market. So we get lots of programmes, and companies meeting with Petronas, Uzma, EnQuest, as to bring technology to the local market. And we’ve purposely tried to look for joint-venture partners here in Malaysia,” he clarified.

Henderson has been pleased with the turnout. “OGA2015 has been a great success; the numbers are higher than they’ve ever been at this event, so the 21 companies are very pleased with the success we’re having so far. And a very positive response to this from the local companies about the technology we’re bringing out here, so it’s worked very well.”

Meanwhile, over at the UK Pavilion, Camilla Tew, Overseas Event Manager for the Energy Industries Council (EIC) trade association, says that the EIC has over 720 members from the O&G sector, so it does everything it can do to help its members. She believes that while there are other such trade expos in the region (such as OSEA in Singapore), OGA2015 is the premier show in all of Asia.

“I think we’re one of the largest Pavilions in the expo, we’ve probably been here (for OGA) 20 years, maybe more. We’ve always run the UK National Pavilion and this year we have 29 exhibitors here in our Pavilion. So as long as our members (the UK exhibitors) want to come back, we’ll come back. We’ve always found this to be a really popular show,” she enthuses.

The EIC had relocated its regional office from Singapore to Malaysia back in July 2014.

Aside from the UK and Scottish Pavilions, there were 14 other Pavilions at OGA2015, including the all-new Denmark, Germany, India, and Singapore Pavilions. But not all of the foreign exhibitors ran under their national Pavilion, and several companies who were not O&G equipment, supplies or service providers were also present as exhibitors. Deb Group Malaysia, for instance, is in the business of providing products for skin safety and skin hygiene, specifically for the away-from-home markets.

CEO Steve Saboune explains that it is Deb Group’s first time appearance at the expo. “Our business is relatively new in Malaysia; we’ve been in Malaysia now for around 2½ years with a direct presence. We found out about OGA2015 through its marketing initiatives, but also through customers. We are here because an industrial market like O&G is a market is where we have a lot of potential customer opportunities and a lot of customer demand because of the risks involved to workers in the area.”

When asked about the prospects of Malaysia’s – and the world’s – industry outlook for O&G, both Alan and Camilla were optimistic. “The future for oil-producing nations is very positive one. There are literally trillions and trillions of barrels of oil that have yet to be extracted, so the technologies that we have, and the continued inventiveness of scientists to find new ways of extraction, has worked very well in Scotland – it’s very innovative and it has worked well for us to bring these new innovations to the world. So there are plenty of opportunities – and very positive opportunities – out here.”

Camilla was more cautious but remained upbeat. “There are going to be ups and down; happens in every industry, doesn’t it? I think you’re seeing an impact at the moment, but you can’t just look at the last 6 months or even the last 2 years. At the moment, people have to be careful where they’re spending their money, but I don’t think this state of affairs will last.”

In the face of the current economic and industry climate, Malaysia still aims to become a top O&G hub in Asia Pacific by 2017. There is evidence that Malaysia is well on its way to becoming – if it is not already – the regional O&G hub for Southeast Asia. It would seem that Malaysia’s O&G future remains very bright.

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