HISTORY OF PETRONAS

Oil was first found in Malaysia in July 1882 in the Baram district of Sarawak in East Malaysia by the British Resident. It was initially used by the local folks for medicinal purposes. Later it was used as fuel for lamps and also for waterproofing of boats and roofs.

It was only in 1910 that the rights to explore for oil was given to the Anglo-Saxon Petroleum Company. This company later became known as Sarawak Shell. Miri became the first oil town in the then British Borneo and marked the advent of Malaysia into the oil and gas business. However further onshore exploration was not successful as there were not much oil onshore to justify further drilling activities.

1960s marked the change of fate for Malaysia with the commencement of offshore drilling which was made possible by advancing technology. It saw the discovery of major oil reserves off Sarawak shores.

1970s saw major oil discoveries off the state of Terengganu in Peninsula Malaysia.

In the earlier days concessions were given to foreign oil companies to explore for oil. In return these companies paid a paltry royalty and taxes to the government.

This all changed after the Israeli War in 1973 when the OPEC countries decided to put out an oil embargo. It resulted in the price of crude oil skyrocketing.

In order to better manage this limited and exhaustable resource, Malaysia introduced the Petroleum Development Act 1974 and the national oil company, Petronas, was incorporated.