Sarawak leaders divided over state’s actions to defend its rights

IN March last year, the Sarawak government established the state’s own oil and gas exploration company, Petroleum Sarawak Bhd (Petros), modelled after national oil company Petronas.

While many Sarawakians were trying to figure out what role the company would play alongside Petronas, which has absolute monopoly over the state’s carbon resources, alarm bells were reported to be ringing in the Twin Towers and Putrajaya on the Sarawak government’s intent.

Source: https://www.themalaysianinsight.com/s/131882

Group wants Sarawak to end oil, gas talks with Petronas

THE Sarawak government must end the ongoing talks between state oil company Petroleum Sarawak Bhd and Petronas over a new oil and gas sharing deal.

State rights group Sarawak Association for Peoples’ Aspiration (Sapa), said the state government must stand up to its rights over oil and gas in the state.

Source: https://www.themalaysianinsight.com/s/99118

Sarawak still guarded in giving details of oil and gas talks

SARAWAK Chief Minister Abang Johari Openg today provided some insight into the highly secretive negotiations between state oil company Petroleum Sarawak Bhd (Petros) and Petronas over the latter’s new role in the state’s oil and gas industry.

He also touched upon the terms of the new resource-sharing agreement, following the state’s decision to fully enforce its Oil Mining Ordinance (OMO).

Source: https://www.themalaysianinsight.com/s/102569

No more business as usual by July, Sarawak CM tells Petronas

SARAWAK Chief Minister Abang Johari Openg has told Petronas it cannot operate as usual from July, adding that the national oil company has not done enough to develop the country’s largest state.

His remarks, carried by satellite TV operator Astro tonight, underscore the state’s move to be independent of Putrajaya ahead of the 14th general election, widely expected to be called next month.

“Petronas must acknowledge the fact that it is our right for them to align with our laws,” the chief minister said in an interview on Astro Awani.

Last night, the chief minister, at the launch of the state-owned Sarawak Petroleum Bhd (Petros), said by July, Sarawak will assume full regulatory authority over the upstream and downstream aspects of the oil and gas industry in the state, and that all individuals and companies wishing to do business in the industry, including Petronas, must have the necessary licences, permits, leases and approvals from the state government.

The legal requirements are from either the Oil Mining Ordinance 1958 or Gas Distribution Ordinance 2016.

Prior to this, Petronas, vested with the powers under the Petroleum Development Act 1974 (PDA), dictated all aspects of the oil and gas industry in the state.

Petronas negotiated and awarded all the power-sharing contracts and its contractors.

Abang Johari said under the new operating condition, as Sarawak exercises its constitutional rights over the two resources, some Petronas decisions are also no longer for the company to make alone.

He gave the appointment of contractors as an example.

“They can’t appoint their contractors themselves. They must get their contractors and sub-contractors who are registered with us,” he said, referring to the new legal requirement for oil and gas companies to have licences, permits, leases and approvals from the state government.

Abang Johari said Sarawak never had a say in the appointment of contractors before.

“We don’t have a say especially in the question of the participation of our private sector.”

He said while the national petroleum company has posted billion of ringgits in profits, it is not doing enough to channel some of the money to develop the state.

“The understanding (for the PDA) was that, Petronas would use part of its revenue to develop the state. Over the years, you can see what has happened.

“Petronas has got lots of revenue, but our perception is that they concentrated their projects in the peninsula, while the state is struggling to get money to develop basic infrastructure.

“Fair enough, it has to be shared throughout the country, but there must be the equitable allocation of resources to Sarawak.”

He said Sarawakians can also see and think.

“Sarawakians are looking at the Twin Towers, and Sarawakians are also looking at all the bailouts of the federal government… and we can think that part of the money comes from Petronas.”

He said Petronas is not doing enough to help develop the state.

“Yes, they have their plant in Bintulu. That is their investment, and we have a certain equity.

“But what must be done is, there must be equitable jobs to be given to Sarawak companies.”

Despite the warning of change, Petronas said the company “is committed to supporting Sarawak’s aspirations to actively participate in the state’s oil and gas industry, in line with the current framework of the PDA”.

In offering its congratulations to the Sarawak government over the launch of Petros, and welcoming the participation of the state petroleum company in the oil and gas sector, Petronas said it is looking forward “to continue collaborating with the state for mutual benefit”. – March 7, 2018.

Source: https://www.themalaysianinsight.com/s/41654

Petroleum Sarawak signs up for Petrotel’s expertise in oil and gas

STATE-OWNED fledgling oil and gas company, Petroleum Sarawak (Petros) has taken its first step into the business with the signing a memorandum of understanding with Petrotel Energy Oman LLC “to explore the possibility of co-operation to develop the downstream sector of oil and gas industries in Sarawak”.

International oil and gas company “with links to Sarawak”, South Sea Energy (SSE), is also a signatory to the MoU.

The signing in Muscat, Oman today was witnessed by Chief Minister Abang Johari Openg.

Chairman Hamid Bugo and board member Zuraimi Sabki signed for Petronas, president Lily Chin and executive director Tiong Kiong King for SSE, and chief executive Dr Anil Chopra and chief operating officer Mike Lucich for Petrotel.

The chief minister, who is on a working visit to Oman and the United Arab Emirates, had earlier witnessed the signing of an MOU between Petrotel and SSE on exploration and production rights in the Arab country.

Petrotel is described on its website as “a leader in oil and gas technology in all aspects of exploration and production with worldwide experience” which has worked on “more than 300 fields worldwide in over 30 countries”.

The Sarawak chief minister and his delegation, which included Deputy Chief Minister and Second Minister of Natural Resources Awang Tengah Ali Hasssn, State Secretary Mohammad Morshidi Abdul Ghani and Sarawak Energy chief executive officer Sharbini Suhaili, arrived in the Omani capital yesterday.

Later yesterday evening, the chief minister and his entourage were shown an overview of the prospects and possibilities of cooperation in the oil and gas sector in the sultanate by SSE.

On Monday, while in the oil refining town of Miri, Abang Johari said Petros would be an active player in the oil and gas industry in two years.

The company was formed in August last year to look after the state’s interest in oil and gas discovered and mined in Sarawak.

Petros is still on a head hunt for a chief executive officer. – January 17, 2018.

Source: https://www.themalaysianinsight.com/s/33006

Petronas’ suit a desperate act to hang on to Sarawak oil rights, says activist

PETRONAS’ legal action seeking the Federal Court’s declaration on the Petroleum Development Act 1974 (PDA) shows how desperate it is to hang on to the state’s oil and gas resources, one of Sarawak’s more vocal political and rights activists Lina Soo said.

“They must have known that they don’t have control over our oil and gas, so they try to get the Federal Court to shut us up,” Soo, who is also the president of the State Reform Party Sarawak (Star) political party said in reaction to the national oil company asking the apex court to declare that it is the exclusive owner of petroleum resources in Malaysia, including Sarawak, and that it is the regulator for the upstream industry throughout the country.

Soo said Petronas’ legal action reflected Prime Minister Dr Mahathir Mohamad’s long-standing position (when he was prime minister from 1981 to 2003) not to accede to Sarawak and Sabah’s demand for a greater share of its oil and gas resources.

“They just want to avoid paying the 20% oil royalty (Pakatan Harapan promised in its election manifesto) and they will try every means not to pay.”

Soo said Sarawakians should not be surprised if the new PH government would use the RM1 trillion debt as an excuse not to increase the royalty.

The two Borneo territories currently are only getting 5%.

In March, Sarawak Chief Minister Abang Johari Openg said the PDA and the equally controversial law, the Territorial Sea Act 2012 (TSA), are not relevant in Sarawak.

He said since both were federal laws and for any federal law to be implemented in the state, the legislative assembly has to ratify them.

Neither the PDA nor the TSA were ever ratified by the assembly.

“Any law that is ultra vires the constitution under Article 4 of the federal constitution is void,” he said.

Sarawak has also warned all companies in the state’s oil and gas industry and companies intending to do prospecting and mining work to have the necessary licences, permits, leases and approvals required under either the Oil Mining Ordinance or the Gas Distribution Ordinance from July 1.

The state’s newly formed oil company, Petros, will from July 1 also assume full regulatory authority over the upstream and downstream aspects of the oil and gas industry in the state from Petronas.

The state government has yet to react to the Petronas action and the state government spokesman, Assistant Minister in the Chief Minister’s Office Abdullah Saidol, said the chief minister will issue a statement on this matter “soon”. – June 4, 2018.

Source: https://www.themalaysianinsight.com/s/52409

Sarawak win over Petronas not certain yet

SARAWAK was quick to celebrate the Federal Court’s dismissal of Petronas’ legal challenge to obtain ownership rights over all petroleum resources in the country, even as the oil company’s lawyer cautioned that the fight was not over.

Chief Minister Abang Johari Openg said the state will now enforce all state laws regulating the oil and gas industry which includes requiring Petronas to obtain approval for its activities in Sarawak.

He said all companies, including Petronas, must by July 1 have the necessary licences, permits, leases and approvals required under either the Sarawak Oil Mining Ordinance (OMO) 1958 or the Gas Distribution Ordinance 2016.

Abang Johari, in a statement responding to the Federal Court’s decision, said it had paved the way for the state government to enforce its state laws, such as the OMO.

He also said state oil company Petroleum Sarawak Berhad (Petros) will be delegated the appropriate powers to implement the OMO.

However, Petronas’ lead counsel Malik Imtiaz Sarwar said the apex court had only ruled that the case did not come under its jurisdiction and had asked for it to be heard in the High Court instead.

Malik was reported by The Malay Mail saying that the Federal Court’s decision was on a “procedural matter” and that the issue was “still very much alive, not been decided in any way”.

The merits of the case have not been decided, he added.

In addition to seeking ownership of the country’s petroleum resources, Petronas also wants the court to declare the Sarawak OMO as overridden by the Petroleum Development Act 1974 (PDA). The OMO was drafted before Malaysia was formed.

The OMO was used by the Sarawak government to inform Petronas that the state would regulate its upstream oil and gas activities from July 1.

Abang Johari has previously said that the OMO would be amended to update its provisions, with a bill to be tabled at the state legislative assembly next month.

Malik today said the federal court’s did not make any decision on the PDA or the OMO, adding that he would wait for further instructions from Petronas before any filing at the High Court.

Bandar Kuching MP Kelvin Yii also expressed caution over any move to celebrate the Federal Court decision today.

In a Facebook post he said Sarawak had to “keep our eyes on the ball and not get ahead of ourselves”, adding that he expected Petronas to take the matter to the High Court.

“While I congratulate the legal team for their efforts and success, there is still an ambiguity in law and technically the status quo still stands.

“PDA 1974 wasn’t repealed, nor was there a ruling to say it does not apply in Sarawak. The legal argument is not about ‘ownership’ but more on regulatory powers of the upstream activities in Sarawak,” Yii said. – June 22, 2018.

Source: https://www.themalaysianinsight.com/s/56201

Abang Jo does not understand the law, says DAP

DAP today told Sarawak Chief Minister Abang Johari Openg that his statement yesterday claiming the Petroleum Development Act 1974 (PDA) and the Territorial Sea Act 2012 (TSA) were “null and void” showed his ignorance of the country’s legal system.

“He can repeat such claims another 100 times, but as these two laws have not been repealed or amended to exclude their application to Sarawak, or declared unconstitutional by the Federal Court, Abang Jo’s (Abang Johari) claim remains mere hot air, an act of ‘shiok sendiri’ (self-indulgence),” Sarawak DAP chairman Chong Chieng Jen said.

“Under our legal system, any law passed in Malaysia and duly gazetted to come into force is deemed good until it is repealed or the Federal Court declares it unconstitutional and null and void.

“Other than the Federal Court, no one, not even the prime minister, can declare a law passed in Parliament to be null and void,” Chong, who was also the Bandar Kuching MP, said, as a war of words broke out between state Tourism Minister Abdul Karim Hamzah and DAP over the chief minister saying yesterday that the two laws were “not relevant” in Sarawak.

Karim had criticised the opposition party for its scorn of Abang Johari’s effort to reclaim the state’s rights over its oil and gas.

DAP, however, said they were merely calling a spade a spade.

“Despite the self-declared rights of Abang Jo, the cold hard facts remain.”

“Sarawak’s entitlement to oil and gas royalties remains a meagre 5%; the remaining revenues generated from the exploration of oil and gas remain with the federal government and Petronas.

“The ultimate ownership and control of the oil and gas industry in Sarawak remains with Petronas and the prime minister; all Petronas pump stations will remain with Petronas and will not be converted to Petros pump stations.

“These are the facts,” Chong said.

“As such, I call upon Karim and Abang Jo to be truthful to the people of Sarawak and not disguise the continued exploitation of our resources by the BN government with laughable rhetoric like Abang Jo’s pronouncement that the PDA and TSA are ‘null and void’.”

The PDA gives Petronas absolute ownership and the exclusive rights, powers, liberties, and privileges to the exploration and exploitation of petroleum resources, both onshore or offshore, in the state.

The TSA reduces the state’s sea boundaries and territorial jurisdiction from 12 nautical miles offshore to three, an act which Sarawakians have long accused the federal government of using to plunder the state’s offshore oil and gas resources.

The Sarawak chief minister had said the PDA and the TSA were ‘null and void’ because they violated the state’s rights in the federal constitution.

The laws have been endorsed by the state legislative assembly and the Conference of Rulers, as required by law. – March 9, 2018.

Source: https://www.themalaysianinsight.com/s/42036

Sarawak eases push for 20% oil and gas royalty

SARAWAK Housing Minister Dr Sim Kui Hian today said the state has eased on its push for a 20% increase – from the current 5% – of the oil and gas royalty.

It would instead focus on getting state petroleum company Petros, off the ground and the potential revenue it could generate.

“We are no longer talking about oil royalty,” the Sarawak United People’s Party (SUPP) president said while speaking to reporters at the party’s Chinese New Year open house in Kuching.

Echoing Chief Minister Abang Johari Openg’s earlier statement that the rights to prospect and mine for all mineral and natural resources in Sarawak, including oil and gas, are rights of the state as spelt out in the federal constitution, Dr Sim also reiterated “all the oil (and gas in the state) belongs to Sarawak”.

“What is ours, is ours. Its in the constitution,” he said in reference to the chief minister’s statement in a live interview over TV1 on Tuesday.

Abang Johari, in explaining why Petronas must obtain a prospecting license if it were to operate in the state, said while the federal constitution stipulates that the development of mineral resources falls under federal purview, it is however subject to item 2(c) of the state list when it comes to Sarawak.

According to item 2(c), permits and licences for prospecting for mines, mining leases and certificates are state matters.

The needs for the state permits and certificates are under the Sarawak Oil Mining Ordinance 1958.

“This means the state has the power to prospect and mine for oil and gas in the state just like Petronas,” the chief minister said.

“If Petronas wants to prospect for oil and gas in the state, they are subject to item 2(c) of the federal constitution and the licence must be issued by the state.

“I (only) work within the perimeters of the law and the federal constitution is supreme law.”

In his Chinese New Year message, the chief minister made it clear Petros will not “just be another production sharing contract company (PSC) but one that will operate alongside Petronas and play an active part in the downstream activities of the oil and gas industry in Sarawak”.

Abang Johari said Petros be an active player in the oil and gas industry alongside Petronas within two years.

With the prospect of a higher revenue Petros could potentially generate from newly discovered gas fields and re-exploiting old oil fields with new technologies, Dr Sim took a swipe at Harapan’s New Deal manifesto for Sarawak and Sabah and the promise to give Sarawak and Sarawak the 20% royalty as demanded.

“They (Harapan) only want to give us 20%. DAP wants to kongsi (share) Sarawak’s resources.

“Petros is just a beginning. The best is yet to come,” the cardiologist turned politician said. – February 16, 2018.

Source: https://www.themalaysianinsight.com/s/38221

In challenge to Sarawak, Petronas wants court to declare it owns all national oil resources

NATIONAL oil company Petronas is asking the Federal Court to declare that it is the exclusive owner of petroleum resources in Malaysia, including in Sarawak.

It is also seeking the apex court’s declaration that it is the regulator for the upstream industry throughout the country.

In a statement, the company said it filed an application before the Federal Court today seeking these declarations based on the Petroleum Development Act 1974 (PDA).

“Petronas believes that the determination of the Federal Court would help provide clarity on its rights and position under the PDA.

“Petronas remains committed to supporting Sarawak’s aspiration to participate in the oil and gas industry in the state for as long as it is within the framework of the PDA,” the statement issued by Petronas’ group strategic communications said.

This move comes as Sarawak prepares to assume full regulatory authority over upstream and downstream aspects of the oil and gas industry in the state from next month.

In March this year, Chief Minister Abang Johari Openg said that Sarawak had regained all the rights to prospect, mine and develop oil and gas in the state, meaning that oil companies, including Petronas, wishing to operate in the state would have to secure a prospecting licence from the state government.

Sarawak Pakatan Harapan leaders, however, disagreed with Abang Johari, saying the state could not reclaim such rights until the PDA and other relevant federal laws were amended.

Petroleum Sarawak Bhd (Petros), a state-owned oil and gas exploration firm, was formed last year and officially launched in March. Abang Johari had said that Petros would not be a partner of Petronas and would instead have the “same status” as the national oil company.

The issue of Sarawak’s rights to its oil resources has long been a contentious one, with the state demanding more than the 5% oil and gas royalty it receives from the federal government each year.

The PH election manifesto for GE14 promised to increase the royalty to 20%. – June 4, 2018.

Source: https://www.themalaysianinsight.com/s/52330

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