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Critique on PETRONAS (Strategic Management Issue)

Strategic Management ( Major Assignment )

Adzfar Kamsani

on 21 January 2013

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Transcript of Critique on PETRONAS (Strategic Management Issue)

BSM 3014 Mohd Noor Adzfar b. Md Kamsani
Muhammad Nabil b. Nordin
Khairul Fizree b. Abd Aziz
Aizri b. Aizudin INTRODUCTION These statements define PETRONAS as an organization, guiding their corporate activities and policies, setting their course for the future.

Vision Statement
To be a Leading Oil and Gas Multinational of Choice

Mission Statement
We are a business entity
Petroleum is our core business
Our primary responsibility is to develop and add value to this national resource
Our objective is to contribute to the well-being of the people and the nation VISION AND MISSION Incorporated on 17 August 1974, PETRONAS vested with the control of the petroleum resources in the country
Exploration & Production
Downstream (Oil & Petrochemicals)
Gas & Power
Logistics & Maritime
Technology & Engineering MAJOR
FACETS Ranked among the FORTUNE Global 500 largest corp in the world.

Wholly-owned by the Government of Malaysia.  CURRENT MANAGEMENT ISSUE PETRONAS sees growth slowdown until 2014

After 2012, in the next two years production issues will limit the company growth.

The downstream segment was the major contributor to company revenue.

Resource for production had been reduce because several factor.

External factor effect the company production. Need to discover a new place for new oil resource to maintain the production

Spend more to maintain level of production as many of its oil fields are mature. NEW STRUCTURE ACHIEVEMENT Petronas has achieved the highest nine-months period as compared to any nine-months period profit thus far.

This profit is achieved even though they are encountering problems with their production contract sharing partner (Murphy Oil Corp).

The profit could be higher if they could tackle the problems their partner are having in Kikeh, offshore Sabah. Despite this, Petronas is still compensating Tenaga Nasional Bhd losses amounting to RM 1 billion to help the company to cope with losses incurred with gas shortages in Peninsular Malaysia.

Petronas is awaiting a new formula of gas pricing mechanism from the National Economic Council i.e the government with hope that this will bring a new light into the current issues inflicting Petronas. Basically PETRONAS is facing issue of mostly politically related

Even with the issues, PETRONAS still manage to prosper growth

The political issues in Sudan and Egypt

On going war and economic instability also contributed CONCLUSION PETRONAS has embarked on a series of projects with other partners.

To secure long-term strategic gas resources and leverage with the Canadian government. RECOMMENDATION Petronas need to find alternative investment to cover up the losses
Foreign investment is the best way
Joint ventures with local related company
Petronas are aiming to invest in India and Russia
Venturing in Islamic countries are considered as an advantage.
Petronas also has the advantage of corporate responsibility
A good track record
This philosophy is not usually applied by other oil conglomerate 1071120502
1071114673 ASSIGNMENT 2
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