Shamsul Azhar Abbas: Reforms At Petronas

Petronas is the national oil company of Malaysia. It was incorporated on August 17, 1974 and vested with the entire ownership and control of the petroleum resource of Malaysia. Given the resource available at hand along with managerial talent it has become a fully integrated oil and gas corporation and is one of the largest companies in the whole planet being part of the Fortune Global 500.

Having a monopoly on the country’s petroleum and gas resource gives it a huge advantage but it comes at a price. Since it’s government owned it cannot at all times be run like a commercial company. Part of its revenues must also go to the government.

Tan Sri Shamsul Azhar Abbas is the president and CEO of Petronas. Not only does he have to deal with global market forces but also with the country’s various political interests. Like his predecessor he has pushed for reforms in the company he has worked for since 1975.

It involves a lot of negotiating since the chief executive of Petronas and its board serves at the pleasure of the prime minister. It has been noted that over the years the government has let the oil firm fund its dream projects and bail out its mistakes.  Abbas has forged on to improve the company’s commercial performance while at the same time negotiating for a cut in the annual subsidy it pays the government. The company funds 40 percent of the national budget.  

Abbas does acknowledge the support of the current Prime Minister, Datuk Seir Najib Razak allowing him to make necessary reforms. Abbas has spent over 35 years with Petronas starting out as an executive trainee in 1975. He rose through the ranks serving in various positions and capacities and became the president and CEO in February 2010.

Abbas has a degree in Political Science from the Science University of Malaysia, MS in Energy Management from the University of Pennsylvania, USA and a Technical Diploma in Petroleum Economics from Institute Francaise de Petrole (IFP), France.