KUALA LUMPUR – Petroliam Nasional Bhd (Petronas) can afford the RM18 billion dividend for the government that was announced under Budget 2021, but anything more will have to be deliberated on by the board, said its president and group chief executive officer Tengku Muhammad Taufik Tengku Aziz.
“If you ask me now if the dividend of RM18 billion announced under Budget 2021 is something we can bear, my answer is yes. It is still within affordability," he said.
He said if there are any additional requests by the government, it would have to be looked into and be based on the perspective of liquidity and solvency as Petronas is governed by the Companies Act.
He said the dividend payout to the government is based on affordability, after rigorous due diligence by Petronas on its financial commitments.
"The dividend process is not a directive (from the government), but based on a request for our consideration. We will fulfil the request if we have the means to do it," he said.
Petronas will also examine the request and lay out its capital and working commitments, he said, stressing that the national oil company still needs to build its buffer should there be further market shocks, such as low oil prices.
"After all of these are satisfied, and should they (the government) ask us and we can still afford it, then we will comply," said Tengku Taufik, adding the RM10 billion dividend payout to the government in November last year followed consideration for the Covid-19 situation at the time.
The RM10 billion was in addition to an earlier RM24 billion paid last year.
Tengku Taufik added that oil price movements are also a good metric to gauge dividend payouts.
The oil price is currently hovering above US$60 (RM242) per barrel.
Finance Minister Datuk Seri Tengku Zafrul Tengku Abdul Aziz had previously said that Petronas’ dividend payout to the government is based on its performance and takes into consideration its funding needs for operations, servicing its obligation and capital expenditure. – Bernama, February 20, 2021
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