Navigation Log: RM2.70 - what a magic number

Whither Malaysia? The recent oil hike, coupled with our low income per capita ie. diminishing purchasing power truly salting the wound especially those of lower socio-economic group. Mind you, at the moment we are an oil exporting country (net exporter). I bet, sooner or later, full-blown sepsis (or it always been like that before?) will take place, and life will be much tougher then. Quoting one brainy minister - tukar cara hidup! Heh cakap memang sedap. Cuba buat sendiri. Jangan makan free. Jangan minyak free. Jangan dapat claim itu dan claim ini. No elaun keraian. And finally, transparent governance? Hell no!

In relation to that, Malaysian Insider interviewed Hassan Merican. Yup, he is my sponsor. Managing an oil company surely a hectic work. Managing a national oil company is even harder. Why? when the public talk about budget, sedikit terpalit juga PETRONAS. They've done pretty good job actually since 1974. Heh. Profit (dan taxable to the Treasury) is one thing. Cost is another - Hatta, Zulfa and Nik Sulaiman: care to elaborate? IHmmm... need to have a lengthy discussion with my father on this.

Anyway, I think the last paragraph is the coolest. Jawab jangan tak jawab...

CEO: Petronas will close down in 10 years if it hands over all profits

KUALA LUMPUR, June 6 — Tan Sri Hassan Marican shuns publicity. He hates press conferences and only meets the media when he wants to.

Yesterday, the president and chief executive officer of Petronas had little choice. With pressure on the ground against the Abdullah administration mounting over the 40 per cent fuel price hike and the possibility of street protests growing by the day, he was directed by top government officials to lift the veil of secrecy that shrouds the operations of Petronas.

He painted a dire scenario facing the national oil company, saying that it would cease to exist by 2018 if it was forced to hand over all the profits to the Government to continue subsidising fuel.

Speaking to editors and senior reporters at a special briefing on Petronas’ contribution to the country, Hassan said that at the close of its financial year in March last year, the national petroleum company had given the Government RM52.3 billion in taxes, royalties and dividends which worked out to be 32% of the Federal Government’s revenue.

“Since the formation of Petronas in 1974 to last year, the company gave the Government RM335.7 billion out of a total profit of RM570 billion,” he noted.

He argued that the oil company needed to reinvest its profits in new technologies and in search of new oil reserves. To date, Petronas has reinvested RM178.9 billion of its profits.

"There is one company, which I don't want to name, that gives back every dollar it made to the government concerned. Now it is suffering," he said.

"Any business if you don't reinvest, you cannot expand... so what do you do? The impact is on the shareholders, which in this case is the government. They will be getting less and less, and eventually zero," he added.

Hassan said continental shelf production and reserves have been coming down, being replaced by deep and ultra-deep water explorations.

"Going forward, it will be tougher. Resources will deplete for sure. Malaysia has been a producer of oil for more than 100 years," he said.

He also dismissed claims by critics of the government that because the price of crude oil was US$130 per barrel, Petronas was making more money than ever and well-placed to continue subsidising fuel prices in Malaysia.

“A lot of focus is placed on the high oil prices. There is very little talk about costs. The costs to explore and to drill for oil have increased by about 200% over the past three years.”

Hassan said Exxon Mobil made about US$40 billion (RM130.31 billion) last year, an increase of only US$1 billion from 2006, in an environment of higher crude oil prices.

“That is the world’s biggest, most efficient and most well-run oil company. Margins have eroded,” he said.

Hassan said Petronas was now “scraping the bottom of the barrel” as far as finding and extracting oil was concerned.

He challenged critics who said that Petronas was not transparent, saying that the corporation published a very detailed annual report which was deposited in the Parliament library.

“For all intents and purposes, Petronas is a public-listed company because we are rated by agencies like Standards and Poor, and Moody. We do not hide anything,” he added.

In the days ahead, the government may come under severe pressure to explain how it has spent the RM335 billion that it has received from Petronas since 1974. Such a disclosure is going to make many people in the government, past and present leaders, sweat.

So obviously PETRONAS is not the main issue. The core issue is the government - you, the ruling coalition. Sila terangkan balik in black and white what you've spent. Kalau satu juta ringgit boleh disumbatkan dalam satu beg galas, think about this very RM335 billion. That's freaking alot of money! Now they've finished up everything like there is no tomorrow ie. not prep up the country good enough in terms of economy, dan sekarang, pass the buck to rakyat.

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Tomorrow there will be the Family Day for The Paats at Bukit Merah Laketown Resort. So I have to drive down south to get there. Mestilah turun. After being away for 6 Aidilfitri, it is imperative to catch up with my cousins whom, some of them I could recognise anymore, due to activation of testosterone and estrogen hormones, heh.

Oh yes, why Paats? Its just another name of my grandfather - Hassan @ Paat. Its in Java (Bahasa Jawa) so don't ask me how he was named by my great-grandfather. Surely it is something meaningful. Just like Sufaat - of which in Arabic : 'Pristine Blessing'. And, as of now, there are few Sufaats around (not Yazid Sufaat eh?). Hmmm... I guess the Sufaat clan is flourishing, more or less similar to the Mericans, Al-Saggoff and such. Insha Allah...

Speaking of family, there's nothing more merrier than chitchatting about local issues with them. Lain macam sikit. Well, on Mac 9, right after the GE, we had a rewang session in Pulau Kapas, Rantau Panjang, and guess what... it was like flipping entertanining - with laughter and sarcasm aloud as there are many sides - staunch-supporter-until-die, sympathisers, activists, don't-bother in the whole family. To the extent I shed tears while grinnning and giggling... haha... kelakar sungguh.

Baiklah ini ada foto-foto merewang. I hope this amalan will continue on... barulah ukhwah!