Generating new revenue sources: Malaysia should look into marine-fuel industry, says expert

According to maritime industry expert Datuk Seri R. Jeyenderan, Malaysia can generate new revenue sources by developing its marine-fuel industry. This would involve positioning the country as a regional hub for blending, storing, and supplying fuel to ships. With over 30 years of experience in the maritime sector, Jeyenderan suggests leveraging Malaysia's petroleum resources, palm oil industry, storage facilities, and ports to create greater economic value domestically.

His proposal comes in response to Selangor Menteri Besar Datuk Seri Amirudin Shari's call for the government to diversify its revenue base and identify new strategic industries. Amirudin, who is also a Pakatan Harapan-Gombak MP, noted that government commitments like subsidies, civil service emoluments, debt servicing, and retirement benefits limit the country's ability to fund development and economic transformation.

Jeyenderan argues that Malaysia can capitalize on the International Maritime Organization's global sulphur limit, which requires ships to use fuel with a maximum sulphur content of 0.50%. This has created demand for marine fuels meeting the sulphur limit specifications. One potential avenue is to produce Very Low Sulphur Fuel Oil (VLSFO) by blending suitable petroleum products, storing the finished product, and supplying it to passing ships.

To participate in more stages of the marine-fuel supply chain, Malaysian companies could obtain fuel components from refineries or suppliers, blend them to meet required specifications, store the fuel in dedicated tanks, and deliver it to ships at ports or via bunker vessels. Another opportunity involves receiving various petroleum products at Malaysian storage terminals, processing them to meet specific buyer requirements, and selling the finished product to shipping operators.

By developing its marine-fuel capabilities, Malaysia could generate additional revenue from fuel blending, storage, trading, transportation, and bunkering services. These activities could support local businesses and generate more demand for port services, logistics, and petroleum trading. However, Jeyenderan emphasizes the need for clear regulatory and operational guidelines to ensure proper handling, storage, transfer, and blending of petroleum products, as well as transparent procedures to protect government revenue and encourage investment in higher-value activities.