Malaysia's Petronas reports profit jump., doubles dividend to government

A logo of Petronas is seen at their office in Kuala Lumpur, Malaysia, April 27, 2022. Picture taken on April 27, 2022. REUTERS/Hasnoor Hussain

KUALA LUMPUR, Aug 30 (Reuters) - Malaysian state energy company Petronas (PETR.UL) on Tuesday reported a jump in second-quarter profit on higher oil and gas prices and said it would double its dividend to the government this year.

The world's fourth-biggest LNG exporter reported a profit for the April-June period of 23 billion ringgit ($5.13 billion), up from 9.6 billion a year earlier. Revenue rose 63% to 93.3 billion ringgit.

Petronas will pay the government, its sole shareholder, a total of 50 billion ringgit ($11.16 billion) in dividends this year, CEO Tengku Muhammad Taufik told a media briefing.

The company was earlier expected to pay 25 billion ringgit, the same as last year, but the government made a request for a higher amount, he said.

Petronas is a key source of revenue for the Malaysian government, which is scrambling to fund a record $18 billion in subsidies and cash aid to offset inflation.

The CEO said oil prices would start to correct gradually next year as supply normalises.

He also said Petronas was on guard against any attempt to seize its foreign assets by a former sultan's heirs, who this year won a $14.9 billion arbitration award against the Malaysian government for reneging on a colonial-era deal. read more

Descendants of the last sultan of Sulu, whose territory once spanned the southern Philippines and parts of Borneo island in Malaysia, are seeking to seize Malaysian state assets in a bid to enforce the award handed to them by a French court.

In July, two Luxembourg-based subsidiaries of Petronas were seized.

The CEO said the company had lawyers on standby to stave off any future seizure attempts in 44 countries where the company has assets.

Petronas was also minimising its exposure by limiting funds being kept abroad, he said.

"What can be kept in Malaysia is maximised," he said.

Petronas and the government have dismissed the claims as baseless. Malaysia has obtained a stay in France pending an appeal.

The award remains enforceable globally under a U.N. convention on arbitration.

($1 = 4.4800 ringgit)

Reporting by Mei Mei Chu; writing by A. Ananthalakshmi; editing by Jane Merriman and Jason Neely

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