KUALA LUMPUR: Tax incentives, promoted by the Ministry of International Trade and Industry (MITI), Malaysia External Trade Development Corp (Matrade) and Petroliam Nasional Bhd (Petronas), are available for oil and gas service equipment (OGSE) companies.
Petronas president and chief executive officer Tan Sri Wan Zulkiflee Wan Ariffin said the aim is to increase players' awareness of availability and applicable tax incentives for the Malaysian OGSE sector.
He said Petronas also provide licensing and registration assistance for Malaysian OGSE providers to support operational excellence in their business operations.
“At the heart of all these efforts is the intent to strengthen local players so they can compete outside Malaysia across all categories in terms of cost and quality.
"Petronas is keen to help build the competitive edge of local OGSEs, enabling them to explore overseas markets and build mutually beneficial partnerships that can enhance their stature, regionally and globally," he said at the 4th Malaysia Oil & Gas Services Exhibition and Conference 2018 (MOGSEC 2018) held here today.
Currently there are about 100 tax incentives available and administered under the Malaysian Investment Development Authority (MIDA) or Ministry of Finance (MoF), 28 of which are relevant to the OGSE sector.
Further, the Malaysia Tax Incentives Compilation and Guide for the OGSE Sector, which was launched today,
outlined tax incentives designed to spur growth and activities in selected segments, such as general investments, high technology companies, integrated logistics services, selected industries, small scale companies, reinvestment allowance for manufacturing, among others.
Wan Zulkiflee said beyond Malaysian shores, players can seek opportunities through direct participation via local subsidiaries, enlisting services of local companies as well as establishing joint ventures which will help spur the growth of the region's oil and gas industry.
"In doing so, players must be vigilant and able to identify risks which may have different features from that of Malaysia,” he said.
In addition, the tax guide also outlines activity-driven incentives include activities such as angel investor, automation, exports, principle hub, research and development, training, vendor development programme as well as stamp and import duty exemptions.
There are also perks for doing business at the East Coast Economic Region (ECER), Northern Corridor Economic Region (NCER) and Sarawak Corridor of Renewable Energy (SCORE).
The oil, gas and energy currently contributes about 15 per cent of Malaysia's gross domestic product (GDP), producing approximately 6.4 Bscf per day of natural gas and nearly 665,000 barrels of oil and condensates per day.
With more than 30 million tonnes per annum (MTPA) of liquefied natural gas (LNG) producing capacity, Malaysia is the third largest LNG exporting country after Qatar and Australia.