What Are The Major Natural Resources Of Malaysia?

Offshore drilling in Malaysia.
Offshore drilling in Malaysia.

Officially known as the Federation of Malaysia or Malaysia Federation, Malaysia is a country that is located in the southeastern region of the Asian continent. The country’s capital city is Kuala Lumpur. Malaysia has an area of about 127,724 square miles, which makes it the world's 66th largest country. The country has a wide array of natural resources including fertile land for agriculture, minerals, and extensive forests. The country’s economy is driven by these natural resources through exports and local sales. However, the nation’s major resource is undoubtedly petroleum. Agricultural products for export and local consumption include things like palm oil, timber, cocoa, pineapples, and others.


Petroleum products such as crude oil are the most valuable natural resources of the country. These reserves also include deposits of natural gas and liquefied natural gas. All these products account for the biggest chunk of the country’s revenue from exports. Most of the sites containing oil and gas reserves are offshore in places such as Sabah’s west coast and Sarawak’s northwestern coast. These vast resources play a huge part in the power generation of the country. Other power production sectors contribute a smaller portion compared to petroleum but all the sources of energy combine to make Malaysia a self-sufficient nation. These other sources include wood and charcoal and hydroelectric power.

As of January 2014, the estimated oil reserves in the country stood at a whopping 4 billion barrels, which placed Malaysia fourth in the Asia-Pacific region. The first three countries were China, Vietnam, and India. In the same year, the natural gas deposits stood at an estimated 83 trillion cubic feet, which placed Malaysia third in the Asia-Pacific region after China and Indonesia. Most of the oil resources in Malaysia are located in the peninsular basin while most natural gas reserves are located in the country’s eastern regions.

The major company in the petroleum sector is known as Petronas, which is a national oil company that was included among the Fortune 500 companies back in 2014. In that year, the company was able to generate a revenue of around $100.7 billion with the assets amounting to an even bigger $169 billion. Compared to other companies in the world, Petronas is ranked as the 69th biggest. All these high revenues mean that the taxes it pays to the government are a major source of revenue. Data shows that at least 30% of the government’s total revenue comes from Petronas. Despite the efforts by the government to reduce its reliance on petroleum, the company, and the petroleum sector by extension, it remains the main source of revenue.

Despite the vast control that the company has in the sector, other companies have also established themselves. These companies include ExxonMobil and Murphy Oil. Due to the presence of more companies in the sector, around 40% of the oil fields have been exploited. At least 3,500 other companies and small businesses are involved in the sector in a support capacity.

Precious Minerals

Malaysia also has a number of mining sites that mine minerals like gold, copper, tin, silica sand, bauxite, and limestone. Tin is among the first mineral to be mined with its production going as far back as the early stages of the 1820s in places like Perak and Selangor. Expansion of tin mining did not begin in earnest until the later stages of the 1800s. Unfortunately, mining of tin stopped in the early stages of the 1980s after its market collapsed because of competition from other countries and declining tin prices. However, at its peak, the country was a global leader in tin production with the country once accounting for around 31% of the global tin production. The mining sector as a whole grew significantly over the years to the extent that it contributed about 7% of the country’s gross domestic product (GDP) in 2003.

Gold is mainly mined in places like Penjom, Selinsing, and Raub although there are minor deposits in places like Terengganu and Kelantan. As of 2002, there were at least 15 active gold mines, which managed to produce 9301.303 pounds of gold in 2001. Most of the iron ores, which are 98 in total, are located in places such as Johor and Kedah. In 2012, the mines managed to produce around 10,077,136 tons of iron ore.

Agriculture and Forestry

Agriculture is a major sector in Malaysia since it accounts for around 12% of the national GDP. In addition, the sector has created employment opportunities for around 16% of the population. Today, the country is a leading exporter in both agricultural and natural resources in the world. Some of the products it exports include timber, palm oil, natural rubber, tobacco, and pepper.

Natural rubber from Malaysia accounts for around one-third of the global exports. In recent times, however, the country has seen a decrease in the production of natural rubber as more people are making a switch to palm oil. Palm oil, which is used for cooking, is much more profitable. However, rubber production is still crucial since it is still a major source of revenue. For example, in 2007, the sector’s revenue reached the $10 billion mark while the revenue stood at $11.24 billion in 2008. Unfortunately, 2009 saw the sector go down by around 6%.

In the palm oil export sector, Malaysia is second only to Indonesia in production capacity. As of 2016, some of the biggest plantations of palm oil were located at areas like Sabah, Sarawak, Johor, and other places. As of 2012, at least 490,000 people were involved in palm oil production. However, a company known as Sime Darby dominates the profitable sector.

Data shows that Malaysia has a massive forest coverage of around 22.2 million hectares. In terms of the total area of the country, forested land makes up around 67.6%. Of this coverage, the bigger part, about 20 million hectares, is covered by natural forests while the remaining is made up of planted forests. Timber for export is harvested from timber plantations, natural forests, or from agricultural areas. In 2015, the sector produced logs with a total volume of about 20.4 million m3. About 15% of this was exported and brought in revenue of around $2.5 billion.


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