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Bureau of Mines / Minerals yearbook mineral industries of Asia and the Pacific 1992
Year 1992, Volume 3 (1992)

Wu, John C.
Malaysia,   pp. [248]-258 ff. PDF (2.7 MB)


Page 249

 THE MINERAL INDUSTRY OFTHE MINERAL INDUSTRY OF MALAYSIA—1992 
249
MALAYSIA 
By John C. Wu 
 Malaysia's important mineral resources include bauxite, clay, copper, ilmenite,
iron ore, natural gas, petroleum, rare earths, and tin. Of these minerals,
only its tin reserves are large and are ranked the world's third largest
after China and Brazil. In past years, deposits of copper, lead, and zinc
as well as gold and silver had been discovered in the central belt of Peninsular
Malaysia extending from Kelantan to Johore. According to the Geological Survey
of Malaysia, mineralization of copper, lead, and zinc associated with considerable
amounts of gold and silver was discovered in the Ulu Sokor area of northern
Kelantan, in the Sungai Lebir, and Gua Setir areas of Kelantan, and around
the areas of Kuala Lipis, Raub, Sungai Lepar, and Chini in Pahang. In 1992,
mineralization of gold was also found in the Penjon area of central Pahang
by Avocent Venture of the United States. However, development activity in
nonferrous minerals was practically at a standstill in 1992 because of the
low metal prices and problems with the land. 
 Malaysia, once the world's largest tin producer, was ranked fifth in 1992.
Malaysia became the world's third largest LNG producer in 1992 and remained
an important producer of bauxite, copper, crude petroleum, ilmenite, kaolin,
monazite, natural gas, and zircon in Southeast Asia. The mining industry,
which contributed 8.7 % to Malaysia's GDP in 1992, remained an important
sector of the economy. Malaysia's mining industry continued to grow at about
3 % in 1992, fueled mainly by continued increased output of crude petroleum
and natural gas. 
 According to Malaysia's Department of Statistics, the output of the mining
industry grew 2.7 % in 1992 compared 
with 5. 1 % in 1991, while Malaysia's GDP grew 8.5 % in 1992 compared with
8.7% in 1991. Malaysia's GDP in 1978 constant dollars was estimated at $36.8
billion,' of which about $3.2 billion was contributed by the mining industry
in 1992. Malaysia exported most of its mineral products to Japan and neighboring
Southeast Asian countries. Malaysia was an important supplier of bauxite,
ilmenite, natural gas, crude petroleum, rare earths, and refined tin to Japan.
The relative importance of Malaysia for supplying crude petroleum, rare earths,
and refmed tin to the United States had diminished, as U.S. imports of these
commodities from Malaysia decreased considerably since 1991. 
 Malaysia remained a net exporter of mineral products in 1992. Malaysia exported
all of its coal, copper concentrate, ilmenite, rare earths, and zircon concentrate
production; between 80 % and 85 % production of its smelted tin, silica sand,
and natural gas production; and about 50 % of its bauxite and crude petroleum
production in 1992. Export earnings were estimated at $40.6 billionin 1992,
ofwhich $3.5 billion was from exports of crude petroleum and about $915 million
from exports of natural gas (in the form of LNG). Malaysia's imports of nonfuel
minerals, such as iron ore and tin concentrate, were mostly reexported after
smelting. However, a considerable quantity of coal, ~ heavy crude petroleum,
and industrial minerals including gypsum, phosphate ~ rock, potash, and salt
were imported ~ annually for domestic consumption. 
 In 1992, the focus of Malaysia's mineral industry's major investment remained
on the mineral fuels sector. In 1992, the oil and gas industry was to invest
about $3.2 billion, of which about 
$ 1 .4 billion was for development of production facilities, about $670 million
for exploration, and about $1 . 1 billion for operation improvements. 
GOVERNMENT POLICIES 
AND PROGRAMS 
 In late 1992, the Federal Government and National Council had approved the
draft National Mineral Policy, tax revisions, and other related mining legislation
including Mineral Tax and Investment, Mineral Title Management, 
~ Mineral Sector Development Plan, Model 
~ State Mineral Enactment, Model State 
~ Standard Mineral Agreement, and Model Federal Mineral Development Act.
The entire package reportedly was sent to the Office of the Attorney General
for final drafting of revisions before ratification and final approval by
the respective State governments and the Parliament. 
 The primary goal of the National Mineral Development Policy is to provide
Malaysia with a modern and internationally competitive regulatory system,
which will allow the mineral sector to expand, diversify, and contribute
to Malaysia's economic development. Under this new policy, local and foreign
investors will be encouraged to explore for bauxite, clay, coal, copper,
gold, rare metals, and silica in Malaysia; miners will be ensured security
of tenure, paying lower royalty, and enjoying tax incentives, such as income
tax allowances on exploration expenditures and lower import duties on mining
equipment. Under this new policy, foreign investors also will be allowed
to raise their ownership in Malaysia venture to 100 % from 30 % in the past
years.2 
 To maintain Malaysia as an attractive 


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