Several energy policies have been formulated in the past. Subsequent to the passing of Petroleum Development Act (PDA), the National Petroleum Policy was formulated in 1975.

The policy aims at regulating the oil and gas industry to achieve the country's economic development needs.

The policy goals include: -

Making available adequate supplies at reasonable prices to support national economic development objectives, thus, placing the application of oil and gas resources to serve national needs as first priority;

Promoting greater Malaysian representation and providing a favourable investment climate, including creating opportunities for downstream industries; and

Effecting an optimal social and economic pace of exploration of the country's endowment of exhaustible oil and gas resources, taking into account the need for conservation of these depleting assets and the protection of the environment.

With the creation of PETRONAS through the Petroleum Development Act of 1974, the oil and gas sector of the energy industry was streamlined to ensure greater Malaysian participation in the ownership, management and control of oil and gas resources and activities. This was made possible through the introduction of a system of production-sharing contracts (PSC), replacing the system of concessions.