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Oil Industry Analysis

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Submitted By aruna2110
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Executive Summary
With the world demand for oil and gas is increasing and likely to increase further and as a developing country creating a best way to produce oil and gas to the unlimited demand. Petroliam Nasional Berhad(PETRONAS) has decided to analyse its business venture in three different countries all over the world. The countries are United States, China and Russia. Investing in international country may give out some financial risk. This paper is discussing the method Petronas can use to overcome all the financial risk in United States, China and Russia. A study on the derivative market of all the three countries is done to measure the risks and to know the ways to overcome the risks. Besides, this paper also discusses the taxation of every each country and how Petronas can minimize the tax burden. At the end of this paper, a conclusion is made (based on the criteria mention above) to which country to invest with different proportion.

1.0 Company Background and Risk Profile
1.1 Introduction to Oil and Gas industry in Malaysia
Malaysia is one of the largest net exporters of oil and gases its region and the world. They have many gas and oil deposits on land and in the oceans surrounding the country. The country produces almost 2% of the world’s natural gas and nearly 13% of the world’s liquefied natural gas (LNG) and is ranked 25th in oil production in the world producing more than 750,000 barrels per day (bpd.) The country's state owned Petronas operates and owns three oil refineries in Malaysia and one in Durban, South Africa and when speaking of Malaysia's oil resources you cannot go without mentioning Petronas every step of the way.
1.2 Background of PETRONAS
PETRONAS, acronym for Petroliam Nasional Berhad, is a Malaysian owned oil and gas company that was founded on 17

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