Sarawak CM dismisses claim Petros will be another 1MDB

SARAWAK Chief Minister Abang Johari Openg has dismissed allegations published online that state oil company, Petroleum Sarawak Bhd (Petros), was created as a vehicle to siphon Sarawak oil money away.

“No such thing. That (claim by the) website – aogm.net – is malicious with malicious intentions,” he said when opening Brooke Dockyard and Engineering Works Corporation’s second fabrication yard in Demak and the loadout of Petronas Carigali’s Bokor D substructure in Bako, 40km from Kuching.

Source: https://www.themalaysianinsight.com/s/137749

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

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

Sarawak regains all rights to its oil and gas

SARAWAK has regained all the rights to prospect, mine and develop oil and gas in the state, said Chief Minister Abang Johari Openg today.

He said the state would by July “assume full regulatory authority over the upstream and downstream aspects of the oil and gas industry in Sarawak” 

This means that after July, oil companies, including Petronas, wishing  to operate in the state would have to secure a prospecting licence from the state government.

Prior to this, under the Petroliam Development Act (PDA), the oil companies received approval from the federal government.

Abang Johari said with the state now enforcing its rights and laws, “all persons and companies involved in the oil and gas industries in Sarawak, must henceforth, have the necessary licences, permits, leases and approvals required under either the Oil Mining Ordinance or the Gas Distribution Ordinance”. 

“They are required to regularise their operations and activities to comply with all state laws including those relating to the use and occupation of land”

He however, gave the assurance that enforcement of state laws would “not jeopardise the interests or investments of Petronas and other companies already involved in the oil and gas industry in Sarawak, whether upstream or downstream”.

“But their business and operational activities must be aligned with our laws and regulations.”

The chief minister said the state cabinet had approved a bill to amend the Oil Mining Ordinance to “update its provisions and to provide better enforcement”. 

The bill would be tabled at the next sitting of the state legislative assembly in July, he said.

Sarawak’s first oil well was commissioned on December 22,1910 in Miri. 

In 1920, the Rajah issued what was known as the Shell Concession Order to designate the area in Miri for the exploration and mining of oil by Sarawak Oilfield Limited – which was owned by Shell.

Exploration for oil offshore Baram area took place in the 1930s by the Dutch and the British.

 In 1952, the Sarawak Colonial government issued an oil mining lease, in the form of a deed, to Sarawak Oilfields Limited with the liberties, right and privileges to explore and mine all “the petroleum lying or within under or throughout the territory comprising the Colony of Sarawak including lands beneath all territorial water.”

In 1954, the Queen in Council passed the Sarawak (Alteration of Boundaries) Order to extend the boundaries of Sarawak to include the area the seabed and its subsoil which lies beneath the high seas contiguous to the territorial waters of Sarawak. 

In 1958, Council Negeri passed the Oil Mining Ordinance to “make better provision in the law relating to oil mining in Sarawak and its Continental Shelf”.

Petros in August last year was granted a prospecting licence to mine oil and natural gas in the state.

Meanwhile, Abang Johari confirmed Saau Kakok was the Petros CEO. 

Saau, a Bidayuh, has spent almost 40 years of his career in the oil and gas industry. 

His last position was Asia vice-president for a US-based independent oil company. – March 6, 2018.

Source: https://www.themalaysianinsight.com/s/41483

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

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

Venezuela launches oil-backed cryptocurrency

VENEZUELA formally launched its new oil-backed cryptocurrency yesterday, in an unconventional bid to haul itself out of a deepening economic crisis.

The leftist Caracas government put 38.4 million units of the world’s first state-backed digital currency, the Petro, on private pre-sale from the early hours.

During the first 20 hours of the pre-sale, which runs through March 19, Venezuela received “intent to buy” offers to the tune of US$735 million (RM2.9 billion), said President Nicolas Maduro.

“The Petro reinforces our independence and economic sovereignty, and will allow us to fight the greed of foreign powers that try to suffocate Venezuelan families to seize our oil,” he said.

A total of 100 million Petros will go on sale, with an initial value set at US$60, based on the price of a barrel of Venezuelan crude in mid-January – but subject to change.

Economist and cryptocurrency expert Jean-Paul Leidenz told AFP that prices during the pre-sale “will be agreed privately” and would then fluctuate according to the market when the initial coin offering of 44 million Petros was made on March 20.

Meanwhile, the government will reserve the remaining 17.6 million Petros.

Venezuela has the world’s largest proven oil reserves, but is facing a crippling economic and political crisis.

Vice-President Tareck El Aissami said the Petro would “generate confidence and security in the national and international market”.

Maduro announced in early December that Venezuela – which is under sanctions from the US, as well as the European Union – was creating the digital currency.

The Venezuelan leader said he expected the Petro to open “new avenues of financing” in the face of Washington’s sanctions, which prohibit US citizens and companies from trading debt issued by the country and its oil company, PDVSA.

But, experts are sceptical about the Petro’s chances of success, pointing out that the country’s deep economic imbalances would only serve to undermine confidence in the new currency.

“Theoretically, with cryptocurrencies, you could bypass the US financial system… but everything depends on generating confidence,” said economist Henkel Garcia.

Meanwhile, consulting firm Eurasia Group estimates that although Venezuela could raise some US$2 billion in the initial offer, it is “unlikely” that the Petro will be established as “a credible means of exchange”, beyond short-term “interest”.

Venezuela is mired in a deep economic crisis triggered in large part by a fall in crude oil prices and a drop in oil production, which accounts for about 96% of the country’s exports.

It is struggling to restructure its external debt, estimated at around US$150 billion by some experts. – AFP, February 21, 2018.

Source: https://www.themalaysianinsight.com/s/39016

Restoring territorial integrity, devolving more powers top Pakatan’s Sarawak agenda

RESTORING the territorial integrity of Sarawak and devolving more powers top Pakatan Harapan’s agenda for the state, should it win the 14th general election.

Unveiling “Part 2” of its election manifesto at the pact’s convention in Sibu today, PH said it would prioritise the dismantling of “two fundamental pillars that Barisan Nasional continues to employ to deceive Sarawakians and sustain its grip on the state – the stripping of territorial integrity and the abrogation of powers”.

The opposition coalition said the restoration of territorial integrity and the devolution of powers would “heal the festering wounds of 55 years in Malaysia”.

The manifesto, launched by PH deputy president Muhyiddin Yassin and state PH leaders, reiterated that the pact was committed to honouring the Malaysia Agreement 1963 and restoring Sarawak to its original status “within the context of the Malaysia Agreement 1963”.

Sarawak was one of four territories, along with the federated states of Malaya, Singapore and North Borneo (now Sabah), that formed Malaysia, but in 1976, the BN government amended the constitution, reducing the status of Sabah and Sarawak as the 12th and 13th states of the federation.

Reading out the “New Deal”, former DAP Piasau assemblyman Alan Ling said a royal commission would be formed “to review various legislation that affect Sarawak’s immutable right to its natural resources, including but not limited to the Continental Shelf Act 1966, the Petroleum Development Act 1974 and the Territorial Sea Act 2012”.

In its devolution of powers proposal, PH promised to remove the BN government’s control over revenues related to budget allocations for development and funds for the implementation of projects with a fiscal decentralisation.

Under the plan, the opposition pact will devolve the power of taxation, which will see Sarawak retaining 50% of all tax revenues collected in the state.

The state will also receive 20% in oil and gas royalties, or its equivalent, from the federal government – something that Sarawak has long demanded.

On education, a lost autonomy right whose return is being demanded by Sarawak, PH said while it upheld the national education policy, “decision rights in education” would be returned to the state to “improve service delivery for the benefit of the children and youth of Sarawak”.

With this, and based on the needs and demographic of Sarawak folk, parents can choose whether to have their children taught in Bahasa Malaysia, English or Mandarin.

There will also be a localised school syllabus featuring local languages, history, politics and geography.

PH said under the education reform, staffing and administrative policies would be reviewed to enable teachers to focus on teaching and not be burdened by administrative matters.

It also promised to set up faculties in universities for the study and development of all native languages in Sarawak, and indigenous knowledge, history and anthropology.

It vowed to make available state education grants, to be awarded based on merit, for students from low-income families who wish to pursue their tertiary education either locally or overseas.

On healthcare, the pact said it would return decision rights to the state.

“The over-centralised healthcare system has not catered to the different needs and demographic of Sarawakians.

“The centralised procurement system, in the form of the middle man, has also significantly increased the cost of healthcare and medicines.”

To overcome the problem, the manifesto said, open competition in the procurement of medical supplies, pharmaceuticals and medical services would be encouraged.

There will also be the upgrading of all general hospitals in Sarawak, to be equipped with cancer and heart centres.

PH also promised to dismantle the BN government’s trade control and licensing system, which it said encouraged monopolies, cronyism and rent-seeking.

The No. 1 target is the removal of controlled import permits on cars, rice, sugar, cement and other commodities, which the pact said “artificially inflated” the prices of goods.

On the management of Sarawak’s natural resources, PH said the state-owned petroleum company set up by the BN government, Petros, would be replaced by an “equivalent of Petronas” and be named “Sarawak Petrogas”.

The company will answer directly to the state legislative assembly, and like Petros, it will be wholly owned by the state government.

PH said Petros was a mere sub-contractor of Petronas, “hopeful to receive some distribution and sub-contract work”. – January 20, 2018.

Source: https://www.themalaysianinsight.com/s/33504

Not true that Sarawak has reclaimed oil and gas rights, says opposition

SARAWAK opposition leaders have challenged the chief minister’s statement that the state has reclaimed its oil and gas rights, saying federal laws ensure the resources remain in Putrajaya’s hands.

They said the state cannot regain the rights when laws like the Petroleum Development Act 1974 (PDA), Territorial Sea Act 2012 (TSA) and Tripartite Agreement, signed by the federal government, Sarawak government and Petronas, have not been repealed or rescinded.

“How can we assert those rights that are constrained and/or no longer in our hands?” said state PKR vice-chairman See Chee How, in response to Abang Johari Openg’s statement at the launch of state oil company Petroleum Sarawak Bhd in Kuching on Tuesday.

The PDA vests in Petronas the entire ownership of, and exclusive rights, powers, liberties and privileges to, the exploration and exploitation of the country’s petroleum resources, both onshore and offshore.

The law gives the national petroleum company complete control in carrying out downstream activities and developments relating to petroleum and related products.

See said the PDA “has completely taken away all our rights, power and privileges over the petroleum resources deposited and found within the territorial boundary of Sarawak”.

The TSA limits the state’s sea boundary and territorial jurisdiction to a mere three nautical miles offshore.

Sarawakians have longed accused the federal government of passing the law to plunder the state’s offshore oil and gas resources by limiting the state’s control to the exploration, exploitation and obtaining of all resources found in Sarawak’s territorial sea, which should have been extended up to 300 nautical miles.

The Tripartite Agreement is purportedly “to irrevocably grant in perpetuity, and convey to and vest in Petronas” Sarawak’s ownership, and the exclusive rights, powers, liberties and privileges of exploring, exploiting and obtaining petroleum onshore or offshore.

See, who is also Batu Lintang assemblyman, said the chief minister “appears to be overly excited and exceedingly optimistic about the indefinite and ambiguous assurance of the prime minister (to return state rights)”, while state DAP chairman Chong Chieng Jen described Abang Johari’s announcement as “much ado about nothing”.

See said the chief minister has “gone overboard with an announcement that may not materialise”.

“With his eyes trained on the next general election, the assurance by the prime minister was vague, and clearly uttered to placate Sarawakians and Sabahans.

“The insincerity of Putrajaya is evidenced by the fact that, until today, the prime minister has yet to get back to Sarawak on the reference made to his office by our late former chief minister, Adenan Satem, to repeal or amend the TSA in 2016.”

He said there has been no progress on the devolution of powers to Sarawak since Adenan died.

“To assert our sovereign power and rights to the issuance of permits and licences for mines, mining leases and certificates under Item 2(c) of the State List under the Ninth Schedule of the federal constitution, in this case, the prospecting, mining and development of our petroleum resources, the federal government must first agree to repeal the TSA and PDA, or make amendments to their provisions, and the Tripartite Agreement signed between the federal government, Sarawak government and Petronas must be rescinded.

“The chief minister must first obtain the assurance and undertaking of the prime minister to repeal the TSA and PDA, and to rescind the Tripartite Agreement, before he can make the announcement that we are now able to exercise our jurisdiction under our Oil Mining Ordinance, with regard to the licensing of oil and gas exploration, exploitation and development.

“Unless all these laws and legal provisions are repealed or amended, to devolve or vest powers back to Sarawak, we are, in effect, powerless.”

See said the announcement by Abang Johari that Sarawak is now able to exercise administrative and regulatory control over all petroleum-related activities in the state is “superficial at best”.

Chong said Sarawak’s entitlement to oil and gas royalties remains a meagre 5%.

The state Pakatan Harapan chairman and Bandar Kuching MP said unless the provisions of the PDA are amended or repealed, whatever laws or regulations passed by the state assembly or set by the state government “will become redundant and ineffective”.

He said the chief minister’s announcement was just another one of his “hot air” stunts, “trying to fool Sarawakians into believing that there is the devolution of powers, when the main control over, and benefits of, oil and gas remain with the federal government”.

“Barisan Nasional has taken Sarawakians for a ride for the past 55 years, and with this perceived devolution of powers, it intends to continue taking Sarawakians for another ride for another 50 years.”

Parti Bansa Dayak Sarawak Baru president Cobbold John questioned how the state could reclaim its oil and gas rights if “Petronas is being allowed to operate as usual”.

He accused Abang Johari of manipulating the Malaysia Agreement 1963 and state rights for political benefits.

“These two laws (the PDA and TSA) need to be amended. Only then can the state assert its constitutional power.”

DAP’s pick for the Stampin federal seat in the 14th general election, Kelvin Yii, said Abang Johari’s announcement “seems to be purposefully orchestrated to mislead the public with regard to the control of our oil and gas resources”.

“Unless there is a repeal or amendment of the PDA, the oil still belongs to the federal government under Petronas, and we are entitled to only a 5% oil royalty.”

The chief minister, in an interview with TV station Astro Awani this morning, said the state’s right to its oil and gas is guaranteed under the federal constitution.

He said even though Item 8(j) under the Ninth Schedule of the constitution grants to the federal government the development of mineral resources, mines, mining, minerals and mineral ores, oils and oilfields; purchase, sale, import and export of minerals and mineral ores, and petroleum products; and, regulation of labour and safety in mines and oilfields, there is a condition.

The condition is that, all those rights are subject to Item 2(c) in the State List, where permits and licences for the prospecting of mines, mining leases and certificates are the rights of the state.

When asked about the PDA and TSA, Abang Johari said under Article 4 of the federal constitution, laws that are inconsistent with the constitution are void.

On the TSA, he said: “Our boundary when we formed Malaysia was 12 nautical miles. It is still 12 nautical miles. It cannot be changed under Article 2 of the federal constitution unless it is agreed to by the state legislative assembly and the Conference of Rulers.”

The state legislative assembly has never agreed to the change. – March 7, 2018.

Source: https://www.themalaysianinsight.com/s/41638

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

Latest Articles