Petronas: Malaysia's National Oil Company

Every barrel of oil and cubic foot of gas produced anywhere in Malaysia belongs, by law, to a single company — and that company hands one of the largest single cheques the federal government receives each year.

That company is Petroliam Nasional Berhad, known as Petronas. It is Malaysia’s national oil company, wholly owned by the Government of Malaysia and operating in over 100 countries. This profile sets out its legal basis, corporate structure, business and its fiscal role.

What law created Petronas and its powers?

Petronas exists because of the Petroleum Development Act 1974 (Act 144). The Act does two things at once: it creates the framework for the company and it hands the company a monopoly over the resource.

Section 2 vests “the entire ownership in, and the exclusive rights, powers, liberties and privileges of exploring, exploiting, winning and obtaining petroleum whether onshore or offshore of Malaysia” in a corporation incorporated under Malaysian company law. That vesting is stated to be irrevocable and to endure for the benefit of the corporation and its successors.

Section 3 identifies that corporation as Petroliam Nasional Berhad — Petronas — and places it under the control and direction of the Prime Minister, whose directives are binding notwithstanding other written law. Section 3A grants further powers, allowing Petronas to acquire commercial undertakings and carry on related business beyond ordinary company powers.

In plain terms: Petronas is a normal limited company on paper, but statute gives it ownership of the nation’s petroleum and makes it answerable to the Prime Minister.

How is Petronas structured and owned?

Petronas was incorporated in 1974 as a limited company under Malaysian company law, with the Petroleum Development Act 1974 as the statutory basis for the petroleum rights vested in it. Its shares are held entirely by the Government of Malaysia, so it is a government-owned entity rather than a listed one. The Petronas group, however, does include listed arms: three subsidiaries trade on Bursa Malaysia — Petronas Gas Berhad, Petronas Chemicals Group Berhad and Petronas Dagangan Berhad.

Operationally the group spans the full petroleum value chain:

• Upstream — exploration and production of crude oil and natural gas, in Malaysia and abroad.
• Gas and new energy — gas processing, liquefied natural gas (LNG), power and cleaner-energy solutions.
• Downstream — refining, petrochemicals and the marketing of petroleum products.

How big is Petronas financially?

Petronas is one of the largest companies in Southeast Asia. Its headline figures for the 2024 financial year, drawn from its Integrated and Financial Report, are below.

Metric (FY2024)	Amount
Revenue	RM320.0 billion
Profit after tax	RM55.1 billion
EBITDA	RM114.1 billion
Total assets	RM766.7 billion
Shareholders’ equity	RM451.2 billion
Capital expenditure	RM54.2 billion

Revenue eased from RM343.6 billion and profit after tax from RM80.7 billion the year before, reflecting softer prices.

Why does Petronas matter to the federal budget?

Because the government owns Petronas outright, it collects both a shareholder dividend and ordinary taxes from the company — a combination that makes Petronas a pillar of federal finances. The figures below are as reported by Petronas in its Integrated Report 2024.

Contribution to government (2024)	Amount
Dividend to the Government of Malaysia	RM32.0 billion
Taxes paid	RM26.8 billion
Cash payments to governments	RM13.1 billion
National Trust Fund contribution	RM0.5 billion
Combined government contributions	RM72.4 billion

Petronas also states that its cumulative contribution to the nation since 1974 — in dividends, taxes and cash payments — has reached RM1.5 trillion, and that its cumulative payments into the National Trust Fund reached RM13.5 billion as of 2024.

This scale is also why the size of the annual Petronas dividend is a recurring feature of Malaysia’s national budget debate: a large dividend supports government spending, but drawing too heavily can constrain the company’s own reinvestment.

What’s next

If you are researching the legal foundations further, read the full text of the Petroleum Development Act 1974 and note the role of state vesting deeds, particularly the arrangements involving Sarawak and Sabah. For the fiscal angle, track the declared Petronas dividend against each year’s federal budget. Financial figures here are from the FY2024 reporting period; check the latest PETRONAS Integrated and Financial Report for updated numbers before relying on any figure.