KUALA LUMPUR — Petroliam Nasional Bhd (Petronas) will finalise its rightsizing strategy by the middle of this year, and thereafter begin the organisational restructuring in phases, its president and group chief executive officer Tan Sri Tengku Muhammad Taufik Tengku Aziz said today.
Currently, the national oil company is still evaluating the workforce size needed, and cuts to be made will take a top-to-bottom approach, he added.
“In the second half of the year, you will see this organisation structure being rolled out in phases. I want to emphasise that this is not about cutting 15,000 to 16,000 jobs,” Bernama reported him saying after the announcement of Petronas’ financial performance for the financial year 2024.
Tengku Muhammad Taufik dismissed claims that the restructuring would favour senior management at the expense of other employees, noting that the restructuring would affect all levels beginning with management first.
“Some people are saying this is a protectionist exercise where senior management is going to be shielded, while everybody else who has no say will be affected if we decide to restructure.
“The first ones who will be affected will be from management onwards,” he said.
He also stressed that mass layoffs are not on the table.
“As reported by many, we do have 15,000 to 16,000 enablers that include all aspects of the support functions. Are you inferring that the reports which say that I am going to wipe out 16,000 (jobs), are correct?
“It is impossible. We need to look at this judiciously and allow the business to spell out its needs,” he said, adding that the affected or displaced employees would be dealt with respectfully and equitably.
Scoop had reported on Dec 28 last year that Petronas was planning a retrenchment exercise as part of measures to cope with projected losses as a result of Petroleum Sarawak’s (Petros) emergence as the sole gas aggregator in the East Malaysian state.
Town halls with staff and internal meetings had already discussed the potential downsizing as of late last year.
Scoop’s report was confirmed earlier this month, on Feb 7, when Tengku Muhammad Taufik said workforce reductions were needed to ensure Petronas’ long-term sustainability. He also stressed that the exercise was “not a retrenchment” but a “right-sizing workforce exercise”.
However, he dismissed the idea that the exercise was linked to Petros’ taking over as Sarawak’s sole gas aggregator, instead attributing the impending downsizing to
Increasing challenges in the oil and gas sector, greater technical difficulties and declining profit margins.
On dividend payments to the government, Bernama reported Tengku Muhammad Taufik saying that this would be based on affordability and board approval.
“We will fulfil the proposed and required dividends based on affordability. It will first take into account our need to continue operating.
“So, there needs to be an adequate cash buffer to cover three to six months of our capital requirements,” he added.
Petronas has paid a RM32 billion dividend to the government following its performance in FY2024.
Tengku Muhammad Taufik also dismissed of any suggestion of animosity between Petronas and Petros.
“We await the details that will be agreed upon in principle, both by the federal government and Sarawak state government, before we can proceed with materialising all working arrangements; this has to be carefully done.
“The positive note is that the principles are coming closer between the prime minister and Sarawak chief minister. We will work out the details. There is no animosity here or lack of communications.” – February 25, 2025