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International Update

Sector Update: Oil & Gas Services

Malaysia’s Oil & Gas Machinery and Equipment sector gained new momentum in August with the opening of the expansion of Halliburton’s Malaysia Manufacturing and Technology Centre in Senai, in the southern state of Johor Bahru.

The additional capability will allow the company to expand its delivery of high-quality products to meet the growing needs of customers in the Eastern Hemisphere and globally. The extension adds 9,844 sq. m. (105,960 sq. ft.) of space and will manufacture products from Halliburton’s Completion Tools product line, including packers, tubing, retrievable safety valves, service tools, subsurface flow, and swell and screens technology, as well as float equipment, stage tools and cementing accessories from the Cementing product line.

“Halliburton’s investment in this expansion demonstrates our continuing commitment to strengthen our position and respond to our customers’ needs, not only in the Eastern Hemisphere, but globally,” said Mark Richard, senior vice president for Halliburton’s Asia Pacific Region. “This additional capacity allows us to continue to strengthen our position in deep water, mature assets and unconventional resources development.”

Rao Abdullah, area vice president for Halliburton’s Central Asia and Southeast Asia regions, said, “This cutting-edge manufacturing plant features a highly efficient shop-floor layout with advanced machines and streamlined processes that will provide maximum efficiencies in production. The additional investment will provide manufacturing jobs and business opportunities, as well as technology knowledge transfer.”

The facility, which originally opened in March 2008, now comprises 29,434 sq. m. (316,828 sq. ft.) on 13 acres (5 hectares) and houses a manufacturing plant, a bulk plant and an administration building. The site also offers onsite technology capabilities, including onsite high-pressure testing capabilities. It is expected that the company’s manufacturing and technology center in Senai will employ approximately 350 people by year-end 2013.

HalliburtonMalaysia_Facility

Halliburton has completed an expansion at its Malaysia Manufacturing and Technology Centre in Senai.
Photo courtesy of Halliburton

Meanwhile, the Malaysia Petroleum Resources Corp., an office of the Prime Minister that administers the Global Incentives for Trading (GIFT) program, has expanded the program to include both resident and non-resident participants. GIFT was established in April 2011 to expedite Malaysia’s emergence as a regional oil trading hub.

Oil and gas is one of 12 National Key Economic Areas in Malaysia’s National Economic Transformation Program. GIFT incentives include a 3-percent flat corporate tax rate on qualifying income and a 50-percent exemption on gross employee income. The GIFT program applies to petroleum and petroleum-related products, minerals, carbon credits and other products upon approval.

For more on this key industry sector in Malaysia’s economy, see “Asia-Pacific’s ‘Significant Location’ for Oil & Gas Services,” an Investment Profile in the May 2013 issue of Site Selection.