Schlumberger marks its 80th year in Malaysia in 2015. What has contributed to the company's ongoing success here?
Our company's anniversary was actually in May 2015, and accordingly we wanted to demonstrate and celebrate our commitment to the country. In collaboration with MIDA, we established the first Center for Reliability and Efficiency, a multi-million dollar investment that is part of a worldwide Schlumberger transformation program launched by our CEO back in June 2012. With a decrease of more than 50% in the oil price since the summer of 2014, the market reality has changed our estimations and growth prospects here. Nevertheless, we went ahead with our investments, and looked for ways to improve our efficiency and our service delivery, and ensure we had the resources to carry out these goals. Our workforce is now around 73% Malaysian nationals, with many in leadership positions, and we are proud of that. We will continue to invest in Malaysia. It is an attractive place to do business. The facilities from MIDA and InvestKL, for example, are all encouraging, not only to Schlumberger but also to other industries and businesses.
What are some of the peculiarities of operating in this market?
For Malaysia to attract international organizations, it needs to facilitate business. By this, I mean not just giving a piece of land to operate on, but also providing financial incentives; it has been excellent at that. Also, in terms of logistics, Malaysia's proximity to Singapore makes conducting business easier and faster. Another factor that differentiates Malaysia is that there is no shortage of national talent, at any level or discipline. Malaysia is a beautiful country and the lifestyle is good, and this standard makes it attractive in terms of bringing in expatriates who are willing to work and live here. All these factors have helped create a competitive market. Finally, Malaysia is a stable and secure country, both just politically and financially.
What impact have foreign firms had on the oil and gas sector in Malaysia?
They have had a significant impact. PETRONAS and the government realize that attracting foreign companies is crucial to developing the country's oil and gas resources. Up to 50% of blocks are currently being developed by foreign firms, ranging from major international oil companies to independent ones. They also support a unique model that encourages local companies to participate in exploration and production. Hence, you see companies such as SapuraKencana and Petra Energy taking part of the new business landscape. These companies are creating joint ventures with international companies. It is a unique business environment. I have worked in different countries around the world, and I have never seen such a diverse mix of business models. The majors and the independents are all still interested in this market.
You established a Research & Engineering (R&E) center in Penang in 2011. How successful has it been?
One thing you can never compromise on is technology innovation, and we continue to spend upwards of $1.2 billion a year in R&E globally. The R&E center in Penang is specifically dedicated to seismic manufacturing and project development. We extended that facility last year, doubling its size to include other service lines such as logging and directional drilling services. Penang has many other electronic and mechanical institutes and talents already there. Therefore, it is becoming a regional hub with a focus on mechanical engineering. In Negeri Sembilan, under the local development program, we created a partnership with a Malaysian company called Omni to develop and manufacture completion equipment. In this successful project, we serve both Malaysia and the globe, including markets such as Saudi Arabia.