KUALA LUMPUR: Budget 2024 provides a favourable landscape for Malaysia’s oil and gas services and equipment (OGSE) companies to strengthen the industry’s fundamentals and secure its sustainability, said the Malaysia Petroleum Resources Corporation.
Its president/chief executive officer, Mohd Yazid Ja’afar said Budget 2024 included significant allocations to advance technical and vocational education and training (TVET) initiatives, upskilling and certification as well as boost Science, Technology, Engineering and Maths (STEM) enrolment.
“These initiatives will provide a vital shot in the arm for OGSE companies which rely heavily on a continuous supply of highly skilled talent but are grappling with a talent shortage, with the OGSE industry needing to maintain a skilled workforce of at least 60,000 by 2030 to ensure its sustainability,” he said in a statement today.
In Budget 2024, RM8 billion was allocated by Bank Negara Malaysia to support the development of small and medium enterprises (SMEs), while the Syarikat Jaminan Pinjaman Perniagaan (SJPP) financing guarantee scheme of up to RM20 billion with up to 80 per cent government guarantee coverage for SMEs could benefit OGSE companies and SMEs.
“The allocations could be utilised to expand OGSE companies’ access to financing and boost their cash flow,” said Mohd Yazid.
Furthermore, MPRC recognised the importance of tax incentives in driving investments and attracting OGSE companies to participate in the energy transition.
It added that the comprehensive study on tax incentives for Carbon Capture and Storage and hydrogen, conducted under the Petroleum (Income Tax) Act 1967 could spur more investments in clean energy technologies and also encourage OGSE companies’ involvement in this space.
MPRC also lauded the substantial allocation of RM2 billion for the Energy Transition Facilitation Fund and RM200 billion Low Carbon Transition Fund as these significant funds are poised to aid OGSE companies in their transition towards more sustainable energy practices.
Meanwhile, Gentari chief executive officer Sushil Purohit said the tax incentives aligned for electric vehicle (EV) players, together with the introduction of the Electric Motorcycle Usage Incentive Scheme, would decisively stimulate the transition to EVs.
“This inclusive initiative, offering a rebate of up to RM2,400 to buyers with an annual income of RM120,000 and below, will enable a wider demographic of Malaysians to pivot towards green mobility,” he said in a statement.
Sushil said these incentives would not only enable Malaysians to transition to green mobility in tandem with the booming global demand for EVs but also contribute to the government’s target to have 10,000 EV charging points installed by 2025 under the Low Carbon Mobility Blueprint 2021-2030.
“As more EVs hit Malaysian roads, there will be a greater impetus for stakeholders to instal more charging points,” he added.
Sushil noted that the government’s pursuit to enhance the Corporate Green Power Programme and explore the third-party access model not only mirrors Gentari’s ventures in escalating investment and development within renewable energy capacities but would also benefit other players within Malaysia’s renewable energy landscape. – Bernama
