Petronas plans to expand venture capital arm with up to US$200m, says report

PETROLIAM Nasional Bhd (Petronas) plans to expand its corporate venture capital arm by as much as US$200 million as early as April, focussing on making innovation and technology investments across Asia-Pacific, according to a foreign wire.

Quoting unnamed sources, the report said that the extra funding could change as the plan is still being finalised.

In a response to Reuters on Friday, Petronas said it “plans to allocate additional funds to Petronas Ventures, increasing the size of its venture capital arm from the US$350 million previously announced in 2019”, but did not say by how much.

The national oil and gas (O&G) company first set up a venture capital arm called Petronas Corporate Venture Capital in 2019. The arm was later renamed Petronas Ventures and has invested in companies including Malaysian agriculture technology start-up Brantree Technologies and US-based waste-to-energy company Ekamor, according to its website.

Petronas posted record-high full-year earnings and revenue for the financial year ended Dec 31, 2022 (FY22). It doubled its profit after tax (PAT) for FY22 to RM101.62 billion while revenue increased by 51.3% to RM375.27 billion from RM247.96 billion, largely due to higher average realised prices for all products and favourable foreign exchange impact.

Earnings were contributed mainly by its upstream business (51.1%), gas business (43.2%) and downstream business (7.5%).

Petronas, Malaysia’s only Fortune Global 500 company, made a foray into the venture capital space when it set up Petronas Corporate Venture Capital in 2019, later renamed Petronas Ventures.

The corporate venture capital arm invests in ‘visionary entrepreneurs with breakthrough technologies and innovative business models’ to support Petronas’ in support of business growth and sustainability agenda. It also aims to be the growth accelerator partner in Malaysia to influence technology-driven startup ecosystems while serving Petronas business needs, according to its website.

Among companies in its portfolio are Braintree Technologies, a drone-as-a-service and robotics-as-a-service for precision and automation of agricultural works and Banyan Nation, a vertically integrated plastic recycling company that helps global brands use more recycled plastic instead of virgin plastic.

Petronas Ventures’ direct investments in Asia and indirect investments into VC funds are managed by Kuala Lumpur-based PTV International Ventures Sdn Bhd while its investments in North America and Europe are managed by San Francisco-based PIVA. – TMR / pic TMR File