UNCTAD 17th Africa OILGASMINE, Khartoum, 23-26 November 2015 Extractive Industries and Sustainable Job Creation Building Institutional Capabilities: PETRONAS' journey in Human Capital Development By Mohamad Yusof Shahid Chairman, PETRONAS Sudan Operations The views expressed are those of the author and do not necessarily reflect the views of UNCTAD. Building Institutional Capabilities: PETRONAS' journey in Human Capital Development Presented by Mr. M Yusof Shahid Chairman, PETRONAS Sudan Operations © 2015 PETROLIAM NASIONAL BERHAD (PETRONAS) All rights reserved. No part of this document may be reproduced, stored in a retrieval system or transmitted in any form or by any means (electronic, mechanical, photocopying, recording or otherwise) without the permission of the copyright owner. ©Petroliam Nasional Berhad (PETRONAS) 2015 1 AGENDA PETRONAS is a Major Multinational Oil and Gas Company 01 PETRONAS: Structured Approach for Human Resources Development 02 PETRONAS in Sudan 04 The Future © 2015 PETROLIAM NASIONAL BERHAD (PETRONAS) All rights reserved. No part of this document may be reproduced, stored in a retrieval system or transmitted in any form or by any means (electronic, mechanical, photocopying, recording or otherwise) without the permission of the copyright owner. ©Petroliam Nasional Berhad (PETRONAS) 2015 2 Agile Development & Growth Transformation of an NOC into a global energy champion REVENUE (USD bil) Domestic Regulator Domestic Player Going International Global Player 100 Ventured into • Ventured into Iraq 2009 Turkmenistan • Acquired Engen Ltd 2012 Duyong - 1st Acquired Progress upstream gas 1996 60 Energy Resources PETRONAS was production incorporated on 17 Aug 1984 1974 Startup of 1st 3-phase PGU 1997 Refinery at project 2008 Kertih (1984-1997) Entered Sudan & Myanmar • Acquired FL Selenia 30 1983 • Acquired stakes in Gladstone Liquefied Natural Gas Project in Australia Introduced and signed 1st PSC to replace 1st LNG shipment to 1991 concession system Japan 1st major Opened 1st 1981 international retail station 1976 venture in Vietnam Expanded into 1980 Petrochemicals 0 YEAR ©Petroliam Nasional Berhad (PETRONAS) 2015 3 What Makes Us Unique Commitment to sustainable development and human rights Incorporated as Professionally Good corporate a company managed citizenship Autonomous Global standards of Commercially decision-making by governance, oriented Executive transparency and Management ethical conduct Maximize value and Commitment to wealth creation for Oversight by Board sustainable shareholders of Directors development and human rights. ©Petroliam Nasional Berhad (PETRONAS) 2015 4 Custodian of National Resources Working closely with ministries to develop the national petroleum sector Prime Minister Ministry of Ministry of Ministry of Ministry of Prime Domestic Energy, Green Natural Ministry of International Minister’s Trade, Co- Technology Resources & Finance Trade & Department operatives & and Water Environment Industry Consumerism Malaysian Custodian- Department of Economic Investment manages the Environment Planning Unit Development petroleum Authority resources of the Nation PS Contractors/ Operators ©Petroliam Nasional Berhad (PETRONAS) 2015 5 Our DNA Vision, mission and values driving strong performance Vision: To Be A Leading Oil and Gas Multinational of Choice Mission Shared Values • We are a business entity • Loyalty • Petroleum is our core business • Integrity • Our primary responsibility is to • Professionalism develop and add value to this national resource • Cohesiveness • Our objective is to contribute to the well-being of the people and the nation ©Petroliam Nasional Berhad (PETRONAS) 2015 6 PETRONAS is a Major Multinational Oil and Gas Company A Fortune Global 500 Company(1) #69 #22 #6 most profitable oil by revenue by profit and gas company World-class Scale in Oil and Gas Production(2) Large Scale Global Reach (mmboe/d) 5.0 2.5 Fully Integrated Diversified Portfolio 0.0 One of the Most Profitable Oil and Gas Deep Technical and Operating (1) Leader in Industry Companies in the World Experience Net Profit (US$ bn) 40 30 Strong Balance Sheet / Prudent Commitment to Corporate 20 Policies / Highly Profitable Governance / Transparency 10 0 ______________________________ (1) Fortune Global 500 (2014) (2) FY2014 production; Source: company disclosures ©Petroliam Nasional Berhad (PETRONAS) 2015 7 Full Integration Across the Entire Value Chain Integration improves margins, diversifies the revenue base and mitigates cashflow volatility LNG Shipping Markets PETRONAS is a Prudent, Safe and Efficient Export sector Operator Regasification Terminal 40+ years operating experience in Malaysia Liquefaction Power sector Natural Industrial sector Commitment to high Gas HSE standards Processed Gas / PGU System High reliability rates Exploration, Development Residential and Deploying technology and commercial sectors Production to enhance value Processing LPG Crude Oil Industrial sector – olefins, fertilizers, methanol Petrochemical Plant Transportation sector – Refining diesel, gasoline, jet fuel and lubricants Petroleum Products ©Petroliam Nasional Berhad (PETRONAS) 2015 8 AGENDA PETRONAS is a Major Multinational Oil and Gas Company 01 PETRONAS: Structured Approach for Human Resources Development 02 PETRONAS in Sudan 04 The Future © 2015 PETROLIAM NASIONAL BERHAD (PETRONAS) All rights reserved. No part of this document may be reproduced, stored in a retrieval system or transmitted in any form or by any means (electronic, mechanical, photocopying, recording or otherwise) without the permission of the copyright owner. ©Petroliam Nasional Berhad (PETRONAS) 2015 9 Overcoming Industry Current Challenges through an Integrated Approach to Develop Competent Human Capital Growing Dramatic Organizational Key global increase in demand for price Levers of Performance energy volatility Declining production Geopolitical & reserves uncertainty from and existing volatility Interlinked Staffing fields Strategic Frameworks Uncon Tight oil & shale gas Young Professional Sudanese Development Monetizati Ultra-deepw Framework on of more ater difficult resources ©Petroliam Nasional Berhad (PETRONAS) 2015 10 ORGANISATION – Key Levers of Performance JOB enrichment and Core Function Specialisation in certain departments to ensure clear focus and accountability to support the key levers Priorities – Strategically inter-related Organization AGREEMENT Ownership & Production Government Motivation Contribution Profit Building Performance Core Creating Governance Leadership Services Compete Value ncies Growth Partner Jobs Contribution JOA Economic Life Sudanization Lever 1 : Partners rights Lever 2 : MC to shape Lever 3 : Blending Lever 4 : Creating Values and position the organisation Partners position with for all local to all stakeholders ©Petroliam Nasional Berhad (PETRONAS) 2015 11 Sudanisation Philosophy Is Based on Staffing Aspiration and Interlinked Strategic Frameworks Input Staffing framework Output 1 2 RequiredRequired Mix Malaysian Optimal JobsJobs in JOC forfor staffing optionsoptions ForFor PSO growth Sudanese Mix Output Input Defines staffing options for Staffing Aspiration each job family YPS dev. f/work Factors affecting general principles On the job training 100% mentoring/peer assist EPSA requirements 80% Local labour laws 60% Formal training Workforce 40% capability 20% Secondment/cross-postings Direct Hires 0% Matches staffing options to YPS Mid Term Long Term Retention framework Malaysian capability dev. role Global Input Improve Output Leader Selec- Improve Right trainingtraining tive ChangesChanges (exits)(exits) profile by staffing in staff basebase option Suggests retention 4 3 Output efforts by capability Input ©Petroliam Nasional Berhad (PETRONAS) 2015 12 Young Professional Sudanese Development Framework Fulfills PSO Aspiration of Growing Own Timber Sudanese staff recruited by PCO Sudanese employed to Seeding Development fill up Sudan JOCs & Program PCO positions Interview & Recruitment by Group Sudanese employed to Talent Sourcing fill other PETRONAS Filling PETRONAS positions worldwide positions In Malaysia Sudanese UTP Scholars UTP Scholarships released to GOVT or offered to Sudanese Filling up other companies Filling up PETRONAS Sudan JOC and Positions PCO positions Worldwide PETRONAS Top Leadership ©Petroliam Nasional Berhad (PETRONAS) 2015 13 Young Professionals (YPS) Development Framework Implementation Has Many Challenges and Issues Seeding Permanent PETRONAS MPB / Educamp Recruitment Program Post Position in LTMP Scholarship (2 yrs) (5-8 yrs Sudan • Number • SI of position • How • Transfer • Transfer in Sudan many • PSCO • 2 years back to to graduated offer seeding Sudan permanent • What program in • To fill position in discipline • When • Which KL or PETRONAS PCSB / and what JOC/ OPU Sudan position in PETRONAS • When discipline for Sudan required attachment CONSIDERATIONS ©Petroliam Nasional Berhad (PETRONAS) 2015 14 Overcoming challenges by developing capabilities PETRONAS capability development programmes Universiti Teknologi PETRONAS (UTP) PETRONAS Leadership Centre (PLC), PLC provides a wide range of learning One of Malaysia's leading science and consultancy and advisory services; and technology institutions of higher innovative solutions for learning, providing students with transformational learning experiences opportunities for the pursuit of covering all critical junctures of the knowledge, expertise and leadership continuum, from leading self advancement in the fields of to leading