SABAHAN oil and gas companies are growing beyond the State’s borders, crediting the Sabah Government’s policy to raise local vendor participation to 60 per cent, while calling for stronger implementation to build capable Sabah champions.
“The policy is quite reasonable for Sabahans and every Sabahan should take this opportunity,” said Nawie Oilfield Services Chief Executive Officer Masnahwi Nawe.
“Sabahan players must not take it for granted and must not just be agents,” he added. Masnahwi was among Sabahan companies met at the 13th Sabah Oil, Gas and Energy Conference and Exhibition held at the Sabah International Convention Centre, which featured 90 exhibiting companies from across Malaysia, Singapore, India and China.
The event is organised by Midas Events Management and supported by the Sabah Government and the Sabah Convention Bureau. Daily Express is the media partner.
Masnahwi said the core challenge is a lack of exposure among Sabahans to the oil and gas industry.
He said his company, also known as NOS, was established in Kota Kinabalu in 2019 and operates in through-tubing well intervention, a complex upstream discipline in which it is the first and only Sabah-based firm and the first such company in Malaysia.
Having built a track record first in Peninsular Malaysia before returning to Sabah, NOS has since secured contracts in Indonesia and is pursuing work in the Philippines and Saudi Arabia.
Masnahwi said the proliferation of civil and downstream contractors in Sabah had led to unhealthy competition and the Alibaba practice of fronting, and urged Sabahan firms to move into more complex operations.
“Oil and gas is a very big division. Our players must be creative and understand what division they are capable of,” he said.
Another Sabahan owned-company, Puncak Kinabalu Oil and Gas Sdn Bhd Chief Executive Officer Sharki S Hussin welcomed the 60pc policy but said implementation remained the critical test.
“The policy on paper is great, but we have not yet seen whether the 60pc will become a reality,” he said.
“What we are looking for is for the Sabah Government to create capable Sabah champions who lead projects, not just participate in them,” he added.
Sharki said the Vendor Development Programme had so far benefited mostly small-service contractors in Sabah and called for policy that would position capable Sabahan firms at the helm of large-scale projects. He said Puncak Kinabalu, founded in 2018, had grown from a small gas pipeline maintenance outfit into a company with four fabrication facilities in Beringgis, Sipitang and Labuan, a workforce of 200 and maintenance contracts including the Kimanis Power Plant.
“We started very small but we believed that with our joint-venture partners, we could be competitive,” he said.
Another Sabahan company, Cakrawala Engineering Services Sdn Bhd Managing Director Suzie Rosse said the policy opened a bright path for Sabah’s young workforce.
“The policy is giving us very good benefits, especially for local Sabahans who have just ventured into oil and gas, and especially for the youngsters,” she said.
Suzie called for upskilling of local talent through TVET and practical training, noting that many engineering graduates were leaving for Peninsular Malaysia or Sarawak due to the small size of Sabah’s oil and gas industry.
Suzie said Cakrawala, established in 2013, provides maintenance, servicing and instrumentation work including valve servicing, plate heat exchangers and tank cleaning for large industries, with all staff being Sabahans.
The company is also developing a new training and competency development product, including HRDC-claimable Non-Destructive Testing courses, for clients such as Petronas and Shell.
Another Sabahan company, Standard Marine Agencies Sdn Bhd Manager Brian Chow said the policy had translated directly into more tendering opportunities for his company.
“I think it provides us a very good opportunity to compete and participate in tenders. All this while we did not have much opportunity, but now we have been getting quite a few oil and gas logistics contracts,” he said.
Brian said Standard Marine, established in 1982, provides total logistics solutions covering warehousing, customs declaration, shipping agency, crew change, crew movement, air freight and sea freight across seven branches in East Malaysia, including Sandakan, Tawau, Lahad Datu, Labuan, Bintulu, Kuching and Kota Kinabalu, with a total group workforce of 250.
For the record, the Sabah Government has set a target to increase local participation in oil and gas service and equipment contracts to at least 60pc by 2026, up from the current 40 per cent.
Sabahan companies currently holds a record 38pc share of oil and gas contracts in the State last year, representing 1,358 active contracts.
