This article first appeared in The Edge Malaysia Weekly on June 10, 2024 - June 16, 2024

CHANGES are afoot at a high level at Petroliam Nasional Bhd (Petronas), and most likely will materialise by early next month, sources familiar with the national oil company tell The Edge.

It is understood that Datuk Adif Zulkifli, executive vice-president and CEO of the company’s upstream business, may be transferred to take over the position of executive vice-president and CEO of the gas and maritime business.

Adif, 54, has long been regarded as the No 2 at Petronas after president and group CEO Tan Sri Tengku Muhammad Taufik Tengku Kamadjaja Aziz.

Adif has helmed Petronas’ upstream business since October 2019. In his new role, he will be responsible for growing Petronas’ liquefied natural gas (LNG) business and overseeing the alignment of the company’s maritime and logistics strategy.

Nevertheless, says an industry source, “it’s a lateral move for him (Adif), and he is likely to have his hands full, [as] it’s the big portfolio of LNG and maritime businesses”.

Among others, Petronas operates the giant 30-tonne-per year Bintulu LNG export facility in Sarawak. The national oil firm also has gas assets in Australia, Egypt and Canada and a 51% controlling stake in energy shipping outfit, MISC Bhd (KL:MISC).

MISC owns AET Tanker Holdings Sdn Bhd, formerly known as American Eagle Tankers, whose total assets are valued at US$4.44 billion (RM20.84 billion), according to its website.

MISC’s market capitalisation stood at RM38 billion, based on its closing price of RM8.58 last Friday. The stock hit an all-time high of RM8.60 recently.

Interestingly, Adif will be replaced by 57-year-old Mohd Jukris Abdul Wahab, who has, since June 2023, been a director of Petronas (E&P) Overseas Ventures Sdn Bhd and Petronas’ wholly-owned exploration arm, Petronas Carigali Sdn Bhd.

Mohd Jukris took a year-long break after heading Petronas’ international assets operations in 2022, after which he was appointed to the boards of Petronas Carigali and Petronas (E&P) Overseas Ventures.

“These are the two key changes at Petronas — Mohd Jukris taking over the upstream portfolio and Adif taking charge of the gas and maritime business. There are other changes as well, with some leaving, but these two are the high-level changes,” says the CEO of an oil and gas company.

“Mohd Jukris is known in the upstream industry, so it shouldn’t be a problem for him. Similarly, Adif is of a high calibre and should do well as head of Petronas’ gas and maritime business.”

According to him, the new appointments and changes at the company have already been made known to several Petronas executives but have yet to be made public.

Prior to Adif’s appointment as head of the gas and maritime businesses of Petronas, Adnan Zainal Abidin had doubled as chief operating officer of the national oil company and executive vice-president and CEO of the gas business.

Adnan’s new focus, apart from his current role as COO, is said to be the overseeing of Petronas’ multibillion-dollar joint LNG project with Argentina’s largest integrated oil and gas company, YPF, for the potential development of upstream gas production, pipeline and infrastructure development, and marketing and shipping.

Adnan will also manage Petronas’ Canadian LNG business and PRefChem — the abbreviation for Pengerang Refining Company Sdn Bhd and Pengerang Petrochemical Company Sdn Bhd — which are joint ventures between Petronas and Saudi Aramco, the national oil company of Saudi Arabia.

It is not known, however, what prompted the changes at Petronas.

The country’s only Fortune 500 company, Petronas has been doing well, with oil prices averaging US$83 per barrel in the first six months of the year.

In the first quarter of its FY2024 ended March 31, Petronas chalked up an after-tax profit of RM21.3 billion on revenue of RM89.7 billion. In the previous corresponding period, it made an after-tax profit of RM23.8 billion on a turnover of RM89.3 billion.

Its operating cash flow in 1QFY2024 fell RM2.1 billion to RM23.4 billion, in line with the lower profit.

In the announcement of its financial results, Petronas says its capital expenditure amounted to RM10.7 billion, primarily because of gas and upstream projects. Its total assets stood at RM796.3 billion as at March 31 this year, compared with RM773.3 billion a year ago.

In the January-to-March period, Petronas recorded a total daily production average of 2.587 million barrels of oil equivalent per day, up from 2.497 million in the same period in 2023. 

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