4 million employed in oil and gas sector
- SOGCE ADMIN
- Jul 10
- 3 min read
Published on: Thursday, July 10, 2025
By: Sherell Jeffrey
Kota Kinabalu: The importance of oil and gas to Malaysia’s economy cannot be understated. The Energy sector employs four million people nationally, with 160,000 specifically in oil and gas industry. Most significantly, 40 per cent of government income comes from oil and gas activities in 2023 alone.
"With 160,000 people, with notable contribution of GDP per employee, we are twenty times multiplier than national average," said Anwarudin Saidu Mohamed, Reservoir Link Energy Berhad Chief Technology Officer who is also the Honorary Secretary of Malaysia Oil, Gas & Energy Services Council (MOGSC).
"The future does not belong to the fastest and the strongest, but it belongs to those who choose to grow together, responsibly, equitably and boldly," Anwarudin said.
“That simply means 40 per cent of cost required to build schools, hospitals and infrastructure is all coming from oil and gas,” he said during a panel discussion at the recent Sabah Oil, Gas and Energy Conference and Exhibition 2025 (SOGCE) Executive Plenary Session.
Shell’s presence in Sabah exemplifies the long-term commitment that builds sustainable energy sectors.
“Shell has been in this country for over 130 years. Starting to mobilise the oil and gas industry first in Miri, Sarawak and then also in developing the nation through the years in collaboration with Petronas,” said Shell Malaysia Upstream Sabah Deepwater General Manager Wong Kim Mun.
The company’s experience reflects three key realities namely growing global energy demand, the gradual pace of energy system changes and the continued importance of oil and gas well into the 2050s and beyond.
Modern oil and gas development in Sabah emphasises environmental responsibility alongside economic growth.
Companies are implementing strict environmental standards and carbon reduction technologies.
“If there is a lot of flaring, then the carbon footprint will be very high,” Yinson Energy CEO Datuk Mohamed Sabri Mohamed Zain said.
“Anything for us more than 11 tons per Barrel of Oil Equivalent (BOE), we do not touch. Because it will cause a big problem for our borrowing,” he said.
Smaller companies are also leading environmental initiatives. Hibiscus Petroleum is pioneering carbon capture and storage technology in Malaysia, planning to become one of the first companies to inject CO2 back into the ground by 2028.
Sabah’s strategic location positions it perfectly for regional expansion into Southeast Asia’s growing energy markets.
“As a Malaysian company, you should be focusing on Southeast Asia, you got lots of activity in Indonesia, Vietnam is picking up again, Thailand’s got plenty,” said the company’s Country Manager Dr Pascal Hos, pointing out the regional opportunities.
“If you can develop something like that, then as a regional company, I would say you probably get more priority than a big international company,” he said.
Panel speakers also pointed out the importance of attracting high-quality investors rather than those seeking only cheap labour and energy.
“The mistake that we do sometimes is that some investors, they come to Malaysia. They want cheap labour. They want cheap energy. So you have to get investor, a high-quality investor. Bring the right industry who can pay the Malaysians well,” said Senior Vice President of Malaysia Assets and Petronas Carigali Sdn Bhd CEO Hazli Sham Kassim.
Ian Lim, ConocoPhillips Malaysia General Manager, noted that ConocoPhillips Malaysia identifies the Kebabangan (KBB) area as potentially becoming the heart of the State’s gas and energy infrastructure to support all these growth and revisions.
In the oil and gas industry, KBB typically refers to the Kebabangan oil and gas field located offshore Sabah.
“These are 15, 20 year horizons. So, stability, fiscals and the supporting environment is needed,” Ian said, pointing out that the company believes future energy development requires long-term thinking and stability.
Looking ahead, Sabah’s potential extends beyond traditional oil and gas operations. The State is positioned to play an important role in Malaysia’s environmental goals, with opportunities in carbon capture, renewable energy and sustainable development.
“Sabah is not only the reservoir of hydrocarbon, it is a reservoir of opportunity,” said Anwarudin.
“With strong fundamentals as we are today and political will and growing infrastructure, Sabah is positioned to bridge the legacy of hydrocarbon with the promise of new energies, empower local content and community-driven development, serve as a regional launchpad for Malaysia’s net zero aspiration too,” he said.
As Malaysia implements its national energy transition roadmap toward 2050, gas is expected to play an increasingly important role.
Sabah’s position as a major gas producer and its potential for renewable energy development make it central to these plans.
“The future does not belong to the fastest and the strongest, but it belongs to those who choose to grow together, responsibly, equitably and boldly,” Mohamed Sabri said.
“The question is no longer why Sabah. It is what more can we do with Sabah and Sabahan and to shape Malaysia energy destiny,” Anwarudin added.
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