KUALA LUMPUR: Datuk Wan Zulkiflee Wan Ariffin will replace Tan Sri Shamsul Azhar Abbas as Petroliam Nasional Bhd (Petronas) president and chief executive officer (CEO) whose contract expired yesterday.

Shamsul, however, will remain in his current post until March 31, and Wan Zulkiflee takes over on April 1.

In a statement posted on the website of the Prime Minister’s Office yesterday, Prime Minister Datuk Seri Najib Razak said Wan Zulkiflee’s appointment is effective from April 1, 2015 to March 31, 2018.

Noting that Shamsul has been serving in his current position since 2010, Najib said the former has worked with the national oil and gas company since 1975, holding various senior management positions.

“With his wide knowledge and experience in this sector, I hope he will continue to contribute to the development of the country especially in the energy sector that is so crucial to the nation’s development,” the premier added.

Wan Zulkiflee, 54, is currently Petronas chief operating officer and executive vice-president of the group’s downstream business.

He is also chairman of Petronas Chemicals Group Bhd and Petronas Dagangan Bhd.

The Edge Financial Daily last Friday reported that Wan Zulkiflee was one of the four candidates in the running for the top post at Petronas.

In 2010, Wan Zulkiflee was said to have been in the running to replace former Petronas CEO Tan Sri Hassan Merican before Shamsul was eventually selected. Many cited his young age at the time as the barrier to Petronas’ top post.

Wan Zulkiflee is taking over the reins of Petronas at a challenging time as low crude oil prices continue to weigh down the energy sector. Petronas had announced a cut in its capital expenditure by up to 20% this year to offset the weak oil prices.

Shamsul had reportedly said payments by Petronas to the government — in the form of dividends, taxes and royalties — could dip by as much as 37% to RM43 billion in 2015 if oil prices hover at around US$75 (RM266.25) a barrel.

Brent crude oil is trading at US$57.56.

Shamsul is known for his candour, but also for emphasising the need for meritocracy and competency in Petronas’ operations as well as dealings, which did not go down well with pro-Malay rights groups.

Last week, Moody’s stated that despite the hit that Petronas’ earnings and cash flow will take due to lower oil prices, its credit profile remains untroubled, underpinned by large liquidity buffer and prudent capital management policies.

This article first appeared in The Edge Financial Daily, on February 10, 2015.