State-owned oil and gas giant Petronas will pay upwards of $2 billion to the Malaysian government to help it weather the Covid-19 pandemic.

The Kuala Lumpur-based company has now approved the additional 10 billion ringgit ($2.4 billion) on top of the 34 billion ringgit 2020 dividend announced earlier this week, to help the government during the economic fallout of the pandemic.

Petronas in the second quarter posted its first loss in almost five years and the operator had already scaled its back capital and operating expenditure because of the latest market downturn.

"In determining whether this additional dividend was affordable, the board first satisfied itself that the company could comfortably continue to fund its operations, service its debts and meet its obligations as well as invest in its future growth," Petronas was quoted as saying by Reuters.

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"Petronas remains resolute in its efforts to preserve cash and strengthen our financial resilience during this unprecedented time."

Malaysia's economy is projected to grow up to 7.5% in 2021, the government said on Friday as it tabled next year's budget.