Country
Assessment
No evidence regarding fiscal and emission reduction incentives could be found in the sources consulted.
No evidence regarding the use of market-based principles to reduce flaring, venting, or associated emissions could be found in the sources consulted.
Article 13 of the Model Production Sharing Contract, 2006 , asks the private and public parties involved to use any surplus capacity in processing and transport facilities for excess associated gas, but this request does not constitute a formal requirement.
There is no evidence of any specific government-imposed flaring or venting-related targets or limits in the sources consulted. However, Petroleum Nasional Berhad (Petronas), the national oil company, has publicly pledged to reach net-zero carbon emissions by 2050. It will do so by deploying (among other levers) its operational strengths to reduce gas flaring and venting, capture methane emissions, and optimize production operations.
The Petroleum Development Act, 1974 , vests the powers and responsibilities over hydrocarbon resources in Petronas. Petronas is under the control and direction of the prime minister (Section 3 of the Petroleum Development Act, 1974). The prime minister also has the power to make regulations relating to the exploration and exploitation of hydrocarbons (Section 7), which he or she may delegate (Section 7A). The Malaysia Petroleum Management (MPM) within Petronas carries out the regulatory responsibilities assigned to Petronas, making it the upstream regulator in Malaysia. Based on the Environmental Quality Act, 1974 , the minister of environment and water is responsible for managing the environment and limiting waste, emissions, and other environmentally adverse factors. In line with Section 3, he or she appoints the director-general of environmental quality, who administers the provisions of the Environmental Quality Act, 1974; the Environmental Quality (Clean Air) Regulation, 2014 ; and other laws and regulations. On issues such as emissions management, the responsible Petronas department (MPM for upstream activities and the health, safety, environment department for activities covering all business lines) typically liaises with the director-general of environmental quality.
Section 10 of the Malaysia-Thailand Joint Authority Procedures for Production Operations, 2009 , bans flaring and venting without prior approval except in the following circumstances: during well cleaning and testing periods (not exceeding 48 hours) in emergencies, such as shutdowns or pressure relief during maintenance (not exceeding one week) during temporary equipment failure (not exceeding 72 hours) during gas release from facilities when alternative uses of gas are not economic.
Section 10 of the Malaysia-Thailand Joint Authority Procedures for Production Operations, 2009 , in alignment with the requirements of the PPGUA , requires prior approval of any flaring or venting other than those that occur under conditions listed in the preceding section. The PPGUA gives the MPM the authority to set gas supply targets and approve plans for associated gas. For the operations phase of an asset the MES Greenhouse Gas Reporting and Management Plan asks for zero continuous venting and reduced routine flaring where operationally and economically feasible to be considered.
The PPGUA provides guidance on the field development plan and its review and approval, including arrangements for any potential gas flaring system in the overall development process. The MES Greenhouse Gas Reporting and Management Plan requires new developments to be designed for zero continuous flaring and venting; to include carbon capture, utilization, and storage for high-carbon-dioxide fields; and to apply a design philosophy that mitigates methane emissions. New developments must also include a carbon footprint assessment to determine the expected GHG emissions over their life cycle. Specific guidance will be provided for both on-field methane emissions measurements and remote measurements capable of capturing these emissions as part of the overall GHG emissions profile. Both new and existing operations must fulfill minimum requirements for the equipment measuring emissions. Section 34 of the Environmental Quality Act, 1974 , in conjunction with the First Schedule of the Environmental Quality (Prescribed Activity) (environmental impact assessment [EIA]) Order, 2015 , entitles the minister of environment and water to ask for an EIA for upstream oil and gas developments, including pipeline and storage construction plans (no requirements for installations specific to flaring and venting). The director-general of environmental quality reviews and approves or rejects the development plans based on the submitted report. In case of rejection, a resubmission with an improved development concept is typically allowed.
The MES Greenhouse Gas Reporting and Management Plan requires new developments to consider near-zero or minimal methane emissions technologies and existing assets to reduce continuous flaring; these will be applicable throughout the asset life cycle where operationally and economically feasible.
The PPGUA provides guidance regarding minimum technical requirements and the approval process for metering systems. Flaring and venting volumes need to be reported, in line with measurement requirements. The MES Greenhouse Gas Reporting and Management Plan has specific measuring equipment and methods as well as frequency requirements for existing assets, and to a reduced extent also for new developments. In line with Section 8 of the Malaysia-Thailand Joint Authority Procedures for Production Operations, 2009 , the license holder must maintain production reports, including volumes of flared and vented gas, and submit them to the authorities. Sections 12–15 also detail metering and measurement requirements.