Malaysia's state oil firm Petroliam Nasional Bhd (Petronas) yesterday reported a 31 per cent jump in yearly earnings, lifted by strong crude oil prices and increased demand.

Unlisted Petronas, Malaysia's largest company, said it posted a net profit of 16.49 billion ringgit ($4.34 billion) for the year to end-March 2001, up from 12.60 billion in the previous year.

Turnover increased by 21 percent to 73.35 billion ringgit. Total assets stood at 139.04 billion ringgit, up from 121.57 billion in the previous year. But Petronas, Malaysia's only Fortune 500 company, said a slowdown in the global economy and the manufacturing sector, its main consumer, would have some impact on the company's performance this year.

"I think any slowdown in the global economy, with U.S. being the biggest economy in the world, will have an impact on the manufacturing sector. Therefore it will have some impact on us as well if there is a global slowdown," Petronas president and chief executive officer Hassan Marican told a news conference.

Petronas has said it expected a windfall in the 2000-01 financial year because of a surge in global crude oil prices which hit 10 year highs last year. In line with stronger international prices, the weighted average price of Malaysian crude oil increased by 32 per cent during the financial year to $29.86 a barrel.

World oil prices are now around $26, while the cost to Petronas of extracting oil is estimated at a mere $8. Petronas said refined petroleum products remained the largest revenue earner for the group, contributing 36.5 per cent to the total. Crude oil formed 24.4 per cent of the revenue.

International operations accounted for 31.3 per cent of Petronas' total revenue, exports 48.4 per cent and domestic 20.3 per cent. Petronas, faced with dwindling national reserves, has been aggressively making forays abroad. It now has operations in 25 countries.

Its total production, both in Malaysia and overseas, amounts to 1.18 million barrels of oil equivalent per day. The company's international reserves totalled 3.3 billion barrels of oil equivalent, or 19 percent of its total reserves.

Malaysia's proven and probable crude oil reserves stood at 3.39 billion barrels as at January 1, 2001, while natural gas reserves were at 82.52 trillion cubic feet, Hassan said. He said at current rates of production, the average life for the country's oil and gas reserves is 16 and 32 years respectively.

Petronas' total borrowing stood at 40.62 billion ringgit as at March 31, down from 43.09 billion a year earlier, with 70 per cent of its debt maturing within five years. Hassan said Petronas has no immediate plan to tap fresh funds.

"We have sufficient funds for debts maturing in less than one year. I have enough money to pay," he said, adding that Petronas' cash and fund investment balance stood at 44 billion ringgit. Analysts say Petronas will have no problems raising funds given its corporate credit quality, which many believe to be higher than the country's sovereign rating.