Malaysia, May 30, 2025 — cybernewschronicle.com — Malaysia’s oil and gas sector is facing a severe talent shortage that threatens to slow production and increase costs, according to industry reports published this week. The shortfall spans engineers, technicians, and skilled laborers, driven by an aging workforce, low enrollment in relevant academic programs, and competition from other regional energy hubs. Industry data shows that Malaysia needs roughly 10,000 new workers annually to sustain current operations.
The country produces about 600,000 barrels of oil equivalent per day. Petronas, the state-owned oil and gas company, has publicly warned that the gap could widen to 30% of total workforce demand by 2030 if no action is taken.
“We are losing experienced personnel faster than we can replace them,” said Ahmad Zaid, director of human capital at Petronas, in a statement to reporters on May 18. “Many senior engineers are retiring. The younger generation is not choosing oil and gas as a first career option.” The problem is not new.
Enrollment in petroleum engineering programs at Malaysian universities has dropped by 40% over the past five years. Students cite volatile oil prices, environmental concerns, and the appeal of tech jobs as reasons for staying away.
Competition from regional rivals
Malaysia is not alone in facing this problem. Neighboring countries like Indonesia and Vietnam are also expanding their energy sectors. They offer competitive salaries and faster career progression.
Some Malaysian-trained engineers are moving to the Middle East, where pay packages are higher. “We are seeing a brain drain to Qatar and the UAE,” said Lim Siew Mei, an energy analyst at the Institute of Strategic and International Studies (ISIS) Malaysia.
“Malaysia cannot match those salaries, so we need to offer other incentives , job stability, clear career pathways, and better work-life balance.” The Malaysian government has responded by easing visa rules for foreign workers in the sector. But industry leaders say this is a short-term fix. They argue that the country must invest in local training and make the industry more attractive to young Malaysians.
Aging workforce and knowledge loss
The average age of a senior engineer in Malaysia’s upstream sector is 55. Many of these workers are set to retire within the next five years. Their departure will remove decades of institutional knowledge.
That includes expertise in mature field management, deepwater drilling, and gas processing. “When a senior engineer retires, we don’t just lose a person , we lose a library of experience,” said Zaid.
“We have tried to capture that knowledge through documentation and mentoring programs, but it is not enough.” Companies are now offering retention bonuses and phased retirement plans. Some are rehiring retirees on a contract basis. But these measures only slow the loss, they do not stop it.
Impact on production and costs
The talent shortage is already affecting operations. Project delays are becoming more common. Maintenance turnaround times are longer.
Safety incidents, while still rare, have ticked upward in fields with understaffed teams. “If we cannot staff our platforms properly, we will have to shut down some operations,” said a senior operations manager at a mid-sized Malaysian oilfield services firm, who spoke on condition of anonymity because he was not authorized to talk to the press.
“That means lost revenue and higher costs for everyone.” The Malaysian Oil & Gas Services Council (MOGSC) estimates that the talent gap could cost the sector up to RM 2 billion annually in lost productivity and overtime pay by 2028.
Steps being taken
Several initiatives are underway. Petronas has partnered with Universiti Teknologi Malaysia to offer scholarships and internships. The company also launched a “Return to Oil & Gas” campaign targeting professionals who left the sector in the past decade.
The Malaysian government has allocated RM 50 million for vocational training centers focused on oil and gas skills. But these programs will take years to produce results.
In the meantime, companies are competing for a shrinking pool of workers. Some are poaching from each other, driving up salaries and making the problem worse. The MOGSC has called for a national task force to coordinate efforts across the industry.
The group wants a unified approach to training, recruitment, and retention. Without that, the shortage is likely to persist.
The talent crisis in Malaysia’s oil and gas sector is not a sudden shock. It is the result of years of neglect in workforce planning. The industry now faces a choice: invest heavily in people, or accept a future of lower production and higher costs.
The decisions made in the next 12 months will shape the sector for a decade.
