Don’t drop austerity mindset

Petronas tells O&G players sustainability of stronger oil price remains to be seen

WHILE the worst of the downturn in the oil and gas (O&G) industry is now over, the outlook is not blue skies. Cost is already showing signs of increasing at a worrying rate, and there is now some premature exuberance among the industry players.

Players should not drop the austerity mindset otherwise all the previous efforts from Petronas’ intensive cost-efficiency efforts over the last three years will be negated.

This was the key message that Petroliam Nasional Bhd (Petronas) president and group chief executive officer Tan Sri Wan Zulkiflee Wan Ariffin wanted to highlight when he presented Petronas’ stellar full year financial results to Dec 31, 2017 to a room full of reporters.

Wan Zulkiflee also emphasised that the current stronger oil price was now supported by production cuts of the Organisation of Petroleum Exporting Countries (Opec) and non-Opec countries, hence the sustainability remains to be seen.

“Therefore, it is imperative to continue to keep costs under control, increase efficiencies and drive up value,” he said.

Certainly, oil prices have recovered remarkably since it started crashing from its high of US$110 in mid-2014. It hit its low of US$27 in January 2016, and has since been on a steady uptrend.

For the most part of 2017, oil prices hovered between the US$50 and US$65 level. Brent traded at US$64 as of press time yesterday.

Overall, Petronas announced strong financial results, both for its fourth quarter as well as its full year to Dec 31, 2017 due to stronger oil prices along with the group’s ongoing transformation efforts which focused on cost optimisation and efficiency improvements.

For the fourth quarter to Dec 31, 2017, Petronas’ profit after tax increased by 61% to RM18.2bil from RM11.3bil in the corresponding quarter last year due to higher revenue and lower net impairment on assets and well costs.

As a result, earnings before interest, taxation, depreciation and amortisation (ebitda) was also higher by 15%, at RM25.3bil compared to RM21.9bil in the corresponding quarter last year.

The group’s revenue rose to RM61.8bil, 14% higher compared with the corresponding quarter last year. This was contributed by higher average realised prices recorded for major products and higher sales volume mainly from LNG and petroleum products, partially offset by the effect of the ringgit strengthening against the US dollar.

Outlook

The positive fourth quarter results were also driven by the upward trend of key benchmark prices and better margins.

“The continued drive for higher productivity and operational excellence have placed Petronas in a stronger position to execute its long-term growth strategy. Subject to sustainability of price recovery, the group expects to deliver a satisfactory performance in the next financial year,” Wan Zulkiflee told a press conference.

Meanwhile, for the full year, Petronas’ profit after tax jumped by 91% in 2017 to RM45.5bil, compared with RM23.8bil recorded in 2016.

The increase was achieved on the back of higher revenue, lower net impairment on assets and well costs and continuous efforts to optimise costs in 2017.

The group’s revenue increased by 15% to RM223.6bil compared with RM195.1bil recorded in 2016. The increase was mainly due to higher average realised prices recorded for major products coupled with the effect of weakening of the ringgit against the US dollar. This was partially offset by lower sales volume for crude oil & condensate and petroleum products.

Cumulative 2017 ebitda rose to RM92bil compared with RM70.7bil recorded in 2016, in line with higher profits.

Ratilal: At current price levels, we have done a lot of adjustments to our asset values, and these have been done over the last three years.

Cash flows from operating activities improved to RM75.7bil, an increase of 41% from RM53.8bil in 2016.

Total assets as at Dec 31, 2017 was slightly lower at RM599.8bil compared with RM603.4bil as at Dec 31, 2016 primarily due to the impact of the ringgit strengthening against the US dollar.

Shareholders’ equity of RM389.8bil as at Dec 31, 2017 increased by RM9.4bil compared to last year mainly due to profit generated during the year.

The group’s gearing ratio remained stable at 16.1% compared to 17.4% recorded last year. Return on capital employed (ROACE) increased to 9.8% compared to 5.4% in 2016, in line with higher profits.

Capital investments for the year ended Dec 31, 2017 totalled RM44.5bil, mainly attributable to the Refinery and Petrochemical Integrated Development (Rapid) project in Johor.

Below are excerpts from the Q&A session Wan Zulkiflee had with reporters. Also present was Petronas executive vice-president and group chief financial officer Datuk George Ratilal.

Dividends:

Petronas paid RM16bil in dividends in 2016. What was Petronas’ dividend payment in 2017 and what is it planning to give out in 2018?

WZ: We gave out RM16bil in 2017. For 2018, we are planning to give out RM19bil in dividends

Capex:

Petronas spent RM44.5bil in capex for 2017. Will this increase in 2018?

WZ: Yes, this year Petronas is planning to spend more, around RM55bil.

Oil price estimation when planning its budget:

When Petronas planned its budget and capital expenditure in 2017, it planned it based on oil prices of US$45. What is Petronas’ estimation of oil prices when it plans its budget for 2018?

WZ: We will be basing our budget similar to the Government’s budget, which is at Brent oil prices of US$52 per barrel.

Outlook for oil price in 2018:

WZ: There are many things that affect oil prices. The Opec voluntary cuts, supply and demand, and also the speculative element. As a company, we are very conservative, and our forecast is somewhat lower than current prices, and this morning Brent was US$64.

In the bigger scheme of things, we are such a small player.

I think the global demand is about 97 billion to 98 billion of barrels a day, and we produce only half a million barrels a day. So in the overall scheme of things, we are small.

Going forward, I think oil prices will be decided by the bigger players. I think we need to look at inventory levels. That is the criteria we know that we have to achieve collectively, for Opec and non-Opec countries. Based on the inventory levels, Opec will decide whether they want to continue with the production cuts.

Petros:

WZ: I have been on record to say that we welcome any such state-owned bodies or business entity in the oil and gas business. We welcome their participation, as long as it is set up within the proper arrangements that have been made.

Who decides on Petros’ investments, and who will be the governing body for Petros?:

WZ: I think since this involves Petros, it is better you ask them. I don’t think I am in a position to respond for Petros.

Level of consolidation among the oil and gas players:

WZ: There have been attempts by a few industry players in Malaysia, but I think it is not as material as we had hoped for. I know its not easy. But I think going forward, we still need competitive big companies to serve the industry in Malaysia and in the region. So we are still encouraging companies to consolidate.

Petronas’ Canada project:

In 2017, one of the significant decisions made by Petronas was not to proceed with the Final Investment Decision on the Pacific North West LNG project and the Prince Rupert Gas Transmission project in Canada. However, Petronas will continue to evaluate options to monetise gas in Canada. So what is the status on Canada?

WZ: Yes, we are producing about 600 million standard cubic feet of gas for the local markets.

And we have world-class gas assets. The proven resources are about 23 trillion standard cubic feet. So, yes we will definitely continue to explore all options that we have to monetise this resource. This is an ongoing process.

Impairments:

GR: At current price levels, we have done a lot of adjustments to our asset values, and these have been done over the last three years. So if prices remain at this level, we don’t see any significant impairments. Impairments happen for two reasons – one is price levels and therefore future cashflows need to be adjusted lower.

The other reason is a breakdown in operational aspects. So that is if something happens somewhere in the business. That, we can’t quite predict. However, besides that, we don’t expect any substantial level of impairments similar to what happened in the last two years.

Retrenchment:

WZ: Today, we dont’ have any big plans for retrenchment. However, as an ongoing exercise and this is nothing new and special, we have got a process where repeated non- performers will have to leave. But this is normal and has been done for many years now.

There is now no specific programme for retrenchment.

FLNG 1 and FLNG2:

Petronas has commissioned the world’s first floating liquefied natural gas (FLNG) liquefaction, storage and offloading vessel – Petronas FLNG Satu – which is now operating offshore in Sarawak. What are the plans to set up a second FLNG?

WZ: FLNG 1 has delivered six cargoes, and we are happy with its performance.

FLNG 2 is now under construction. It will be in operations in 2020. We are confident that we are on track to be operational by then.

Source: https://www.thestar.com.my/business/business-news/2018/03/03/dont-drop-austerity-mindset/

Development plans put Sarawak on right track

KUCHING: Sarawak has achieved positive economic growth despite global economic uncertainty, Yang di-Pertua Negeri Tun Abdul Taib Mahmud said.

He said the state’s economy grew by 4.7% last year compared to 2.3% in 2016, while the Gross Domestic Product (GDP) per capita increased from RM44,000 in 2016 to RM46,000.

Exports also grew from RM77bil in 2016 to RM96bil last year. The poverty rate meanwhile dropped from 0.9% in 2014 to 0.6% last year and unemployment remained at less than 4%.

“Sarawak’s growth is supported by strong economic fundamentals, good administration and financial management by the state government,” Taib said when opening the Sarawak Legislative Assembly session here yesterday.

He said the state government’s development plans, such as the Socio-Economic Transformation Plan, Sarawak Corridor of Renewable Energy (SCORE) and Digital Economy Plan, would continue to boost growth and attract investment.

“These are people-centric plans that will improve socio-economic standards and create jobs, especially for the talented and highly-skilled younger generation,” he said.

In particular, he said the Digital Economy Plan could increase productivity in sectors like agriculture, manufacturing and services by promoting the use of digital technology and applications.

“The digital economy has the potential to create new opportunities for our younger generation.

“I believe our young people have the creative and innovative skills necessary for the digital era,” he said.

On another matter, Taib expressed confidence that the state government would be able to manage Sarawak’s oil and gas resources for the benefit of the people.

He said efforts towards developing and managing these resources sustainably had been put in place, including the enforcement of the Oil Mining Ordinance 1958 and Gas Distribution Ordinance 2016 and the formation of Petroleum Sarawak Bhd (Petros).

“This is in line with Sarawak’s aspiration to become an oil and gas hub in the region and to collaborate with Petronas for the interest of Malaysia and the state,” he said.

As such, he said Sarawak’s rights to its territorial waters must be preserved so that the oil and gas resources found there could be developed to benefit the state.

Source: https://www.thestar.com.my/metro/metro-news/2018/07/10/development-plans-put-sarawak-on-right-track-state-economy-grew-by-47-last-year-poverty-rate-dropped/

Affin Hwang upgrades Petra Energy to buy as risk-reward looks favourable

KUALA LUMPUR: Affin Hwang Capital Research says the risk-reward is looking favourable for Petra Energy and upgraded its rating to buy with a higher 12-month target price of 59 sen.

Accoding to the research house, Petronas has been issuing more contract awards and work orders while Petra Energy has also seen higher work orders for hook-up, construction and commissioning (HuCC) contract to the value of RM150mil.

Meanwhile, the maintanence, construction and modifgication contract with Petronas is also picking up momentum in terms of mor work programmes amounting to RM50mil by our estimates. 

“PENB has recently completed the production enhancement programme and is in the midst of
doing some commissioning work. Based on a back-of-envelope calculation, this will increase targeted production to approximately 5,500–5,800 barrels per day (from 4,500 barrels). 

“We are also positive that the KBM risk service contract (RSC), which is due to expire by mid-2020, stands a good chance of being extended, on the current high oil price and good production track record.”

Affin Hwang also believes that Petra Energy stands a good chance of wiinning a rebid for the HuCC contract for another five years, with a total outstanding orderbook current at RM1.6bil.

With regrds to operating in Sarawak, the research house said it understands that service providers like Petra Energy are still waiting for Petros to award licences although it should not have a problem in getting the licence.

Source: https://www.thestar.com.my/business/business-news/2018/07/05/affin-hwang-upgrades-petra-energy-to-buy-as-risk-reward-looks-favourable/

‘Unity the key to success’

KUCHING: Sarawak’s Malay community must preserve unity among themselves and with other communities so that the state can continue to develop.

Making this call, Deputy Chief Minister Datuk Amar Awang Tengah Ali Hasan said unity was the key to the community’s success over the years.

“But we cannot take this for granted. We need to identify our weaknesses and correct them for our unity to remain strong,” he said when opening a Malay cultural seminar here yesterday.

Awang Tengah said unity and development were the goals of the state government’s leadership under Chief Minister Datuk Patinggi Abang Johari Tun Openg.

“We want Sarawak to be a developed, high-income state by 2030.

“Various initiatives have been introduced to take back our oil and gas rights, such as amending the Oil Mining Ordinance and setting up Petroleum Sarawak Bhd (Petros),” he said.

Awang Tengah also reminded the Malay community not to ignore the rights of others communities in protecting their own rights and interests.

For instance, he said the setting up of the Unit For Other Religions (Unifor) should not be misunderstood.

“Unifor was set up to preserve the harmony in Sarawak’s multicultural society, where people from different faiths, cultures and backgrounds live together in unity.

“No single race can rule on its own without working together with the others. This is the reality.

“As Malays, we should be united and continue to respect and work together with the other communities in the state,” he said.

The three-day seminar was organised by the Sarawak Malay Cultural Foundation with the theme “Managing Culture in the Digital Era”.

The topics discussed included politics, education, rural development and leadership.

Source: https://www.thestar.com.my/metro/metro-news/2018/10/31/unity-the-key-to-success/

Sarawak O&G players set to gain under Petros

PETALING JAYA: Sarawak oil and gas players are set to benefit as the state transitions into the new administration of its oil resources under Petroleum Sarawak Bhd (Petros), with plans to increase local participation in the industry.

UOB Kay Hian Research singled out Serba Dinamik Holdings Bhd as among the major beneficiaries, aside from other Sarawak-listed companies like Dayang Enterprise Holdings Bhd , Petra Energy Bhd , KKB Engineering Bhd (via OceanMight) and Brooke Dockyard.

The research house recently attended the Sarawak oil & gas seminar and exhibition, said the issues covered during the conference included Petros’ plans, and matters relating to vendor development and reserves data.

By end-2019, it said, Petros would take firm action to implement the state’s mandate, particularly in relation to revenue sharing and local participation.

“We believe this is necessary to kick start delayed greenfield projects,” it said in a note.

The research house, which maintained its “market weight” stance on the sector, said Petros CEO Sauu Kakok clarified during the seminar that their key targets included driving more share of revenue from Sarawak O&G resources and boosting participation of Sarawakians.

Petros, it said, was actively working towards meeting the “hard target timeline” of Dec 31 for measures including setting up governance policies.

“This implies that the one-year grace period for Petronas, Putrajaya (and its key advisors), and Sarawak state will conclude.

“We understand further delays are unlikely as all stakeholders are working hard to reach firm agreements,” the research house said.

Petros, which was set up in August 2017, is in charge of regulating upstream production, governed under the oil mining ordinance 1958. It is also regulating the gas distribution governed under the distribution of gas ordinance.A technical session during the seminar revealed that the Sarawak basin has 23% of Malaysia’s oil and 51% of natural gas.

For the overall sector, UOB Kay Hian said many O&G stocks remained “too locally dependent”. It noted that Petroliam Nasional Bhd (Petronas) would focus on overseas upstream capex, while domestic upstream capex is set to improve from RM12bil in 2018 to RM15bil in 2019.

“We understand local activity levels have generally increased, especially for maintenance/brownfield works, with maintenance, construction and modification contractors like Dayang Enterprise and Petra Energy guiding high activity levels in 2019 although rates remain low,” it said.

The research house said it favoured internationally competitive companies, like engineering, procurement, construction and commissioning and storage operator Dialog Group Bhd and Yinson Holdings Bhd .

Source: https://www.thestar.com.my/business/business-news/2019/04/18/sarawak-og-players-set-to–gain-under-petros/

The Petronas-Sarawak oil intrigue

Change in political landscape paves way for a decision on who has control over oil and gas resources once and for all

SIX DAYS after former prime minister Datuk Seri Najib Tun Razak announced the dissolution of Parliament, Petroliam Nasional Bhd (Petronas) received a letter from the Attorney General (AG) of Sarawak, which it knew it had to act on.

The letter effectively aimed to relieve Petronas as the undisputed guardian of oil and gas (O&G) resources in Malaysia and its powers to be shared with the state government-owned Petroleum Sarawak Bhd (Petros).

Officials familiar with the matter say the biggest fear for Petronas was that its role as the authority for any O&G exploration works would be compromised not because of inadequate laws, but the weak political strength of the federal government.

“But the change in the political landscape after May 9, where the shift in power moved to Pakatan Harapan, gave fresh hope that Petronas has an even chance to allow the courts to determine who is the guardian of all O&G resources in the country.

“The state based its case around the Sarawak Oil Mining Ordinance (OMO), while Petronas is anchoring its case on the Petroleum Development Act 1974 (PDA). Under Pakatan, the mantra is to follow the rule of law, which is good for all parties,” says the official.

On April 13, the letter from the Sarawak AG stated that Petronas would deal with Petros on all matters pertaining to the extraction of O&G resources effective July 1.

It officially positioned Petros as the sole authority to issue licences and permits on all upstream O&G activities carried out in the state.

Hence, Petronas, its sub-contractors and partners in the production-sharing contract ventures are to work with Petros in the extraction of O&G resources in the state with the most amount of reserves in Malaysia.

“When the letter came, Petronas was expecting the worst because over the past five years, it had lost many battles to the Sarawak state government. This was largely because the federal government was weak and did not provide Petronas with ‘air cover’ when it came to matters dealing with Sarawak,” says an official close to the matter.

To the international O&G world, the letter from Sarawak effectively was a blow to the standing of Petronas as the sole authority of O&G resources in the country.

The national oil company faces the daunting prospects of explaining to oil majors such as Shell, Murphy Oil, Mubadala Oil & Gas, Total and Nippon Oil that they have to go through one more layer – Petros – for any type of work they are going to undertake in O&G ventures in Sarawak.

In the past few years, Petronas president and chief executive officer Tan Sri Wan Zulkiflee Wan Ariffin never hid the fact that the company was getting uncomfortable with the situation in Sarawak. He had the view that the practice in most countries was for a single body to be the sole authority for O&G resources.

In this respect, Petronas has always anchored on the PDA that came into effect in 1974, vesting it as the sole authority for all upstream O&G activities in the country. This involves exploration works and entering into contracts with international partners to mine O&G fields, whether onshore or offshore Malaysia.

In return, the states of Sarawak, Sabah and Terengganu, which have O&G resources, receive royalties amounting to 5% from Petronas.

The absolute amount received by these states depends on the quantum of O&G resources extracted from the state. For instance, between 1978 and March 2000, Terengganu received RM7.13bil in royalties. Global oil prices averaged US$20 per barrel then.

In a legal suit between Terengganu and the federal government, it was disclosed that the latter had offered to pay the state RM1.67bil for the period from March 2000 to 2009, while the state wanted RM2.79bil. The matter was settled out of court.

GE14 a turning point?

Petronas vice-president and group general counsel Maliki Kamal Mohd Yasin wrote back to the Sarawak AG stating that it disagreed with the assertion of the state requiring it to get licences and permission from Petros to embark on any work starting from July 1.

It is learnt that Maliki’s argument was anchored on the PDA that vested all rights to upstream O&G resource activities to Petronas.

Maliki’s letter was sent on May 22, just two weeks after Malaysia saw a turning point in its political landscape.

Sarawak, which was the king maker in the previous administration under the Barisan Nasional with 25 seats in Parliament led by Najib, no longer held that precious position. Sarawak’s Barisan won only 19 seats in the 14th general election (GE14) and is facing a different federal government in the form of Pakatan.

The new federal government does not need to depend on Sabah and Sarawak to control Parliament.

The Pakatan coalition, led by Prime Minister Tun Dr Mahathir Mohamad, has more than 112 Parliamentary seats in Peninsular Malaysia and does not have to depend on allies from Sabah and Sarawak to form the government.

The political shift is viewed as something that works in favour of Petronas.

Whether by sheer coincidence or design, in the first week of June, Petronas filed a suit seeking a declaration that it is the sole governing authority for upstream O&G activities in Malaysia for onshore and offshore fields.

Petronas also wants the courts to declare that the PDA supercedes the Sarawak OMO, the law that the state has used as its basis for setting up Petros as the sole authority for O&G activities in Sarawak.

It is not hard to fathom why Petronas wants a decision in determining who controls the O&G resources in Sarawak as soon as possible.

Starting from July 1, the function of Petros as the sole issuing authority for all licences and approvals for O&G activities in the state is to kick off. Petronas would be deemed illegal if it operates in Sarawak without getting the approval from Petros.

The suit, which is to be heard on July 12, will consequentially determine if the Sarawak state assembly has any standing to preside on matters regarding the upstream activities of the O&G industry.

However, when it comes to matters pertaining to Petros, the state Pakatan and Barisan parties seem to have a similar stance.

Towards this end, Sarawak Parti Keadilan Rakyat vice-chairman See Chee How has already stated that the state cannot afford to lose the case against Petronas.

However, the federal government has already stated that it would manage the country based on the rule of law. On this score, Dr Mahathir has already said that the Petronas case is something that the company has taken up and that it would abide by the decision of the court.

Landmark case

The case between Petronas and Sarawak will be an interesting landmark because it sets the stage for other states such as Sabah and Terengganu to set up their own version of “Petros”. In fact, Sabah already has a similar set-up but it is not active.

As for Terengganu, the state government will directly get oil royalties from Petronas after 18 years. And ironically, it is coming from the same Prime Minister who had stopped payments to the state after it fell into the hands of PAS in 1999.

After Barisan lost Terengganu to PAS in the November 1999 GE, Dr Mahathir channelled the payments to a federal government-owned entity. The payments stopped in March 2000.

Payments were made through a federal government entity and was known as Wang Ehsan. It continued until 2009 when Barisan regained the state.

The utilisation of funds between 2004 and 2008 was said to be one of the reasons that led to the ouster of Datuk Seri Idris Jusoh as Mentri Besar of Terengganu. He was replaced with Datuk Seri Ahmad Said after the 2008 GE.

During Ahmad Said’s tenure, one of the proposals for the utilisation of the funds in a supposedly transparent manner led to the birth of 1Malaysia Development Bhd or 1MDB – the fund that is subject to a massive investigation at domestic and international levels.

Since 1974, when the PDA came into effect, Petronas has been managing the resources. It has a monopoly and is the sole authority to go to for any investor wanting to get a piece of the action. Unlike some other state-owned petroleum companies such as Pertamina of Indonesia, Petronas has been handling the contracts well.

However, after 44 years, the states, especially Sarawak and Terengganu, have established many companies and employed people with vast experience in managing O&G resources. It is only natural that they would want a bigger role to play.

However, under the Pakatan government, Sabah and Sarawak are to get 20% of the royalties instead of 5%. That itself is a lot of money to handle – running into billions. As we have seen in Terengganu, the handling of the royalty money from Petronas itself is a full-time job.

Although the current case only involves Petronas and Sarawak, the implications are wide-ranging.

The courts will decide once and for all who controls the O&G resources. This decision will come in an environment where nobody has any room to cast doubts if there were hidden hands behind any court judgements.

A decision either way will have a major impact on the O&G industry in the country.

 

 

 

Related story:

Petronas warned of July 1 being the cut-off date

Source: https://www.thestar.com.my/business/business-news/2018/06/09/the-petronassarawak-oil-intrigue/

CM relays S’wak’s oil royalty stand to students overseas

KUCHING: Chief Minister Datuk Patinggi Abang Johari Tun Openg has reiterated that Sarawak is constitutionally entitled to licensing rights over its oil and gas resources.

Even the authorities in Putrajaya had acknowledged the state’s rights on the matter, he told Sarawakians residing and studying in Britain during a gathering organised by the Sarawak Foundation in London.

“We have the licensing rights and Petronas’ is the development part,” he said in reference to the Federal Constitution’s provisions.

As such, Abang Johari said the state government through its oil and gas company Petros is collaborating with Petronas to ensure that Sarawak would stand to benefit from its oil and gas resources.

He added that although the state’s licensing rights had not been enforced in the last 40 years, Sarawak would not compromise on what lawfully belonged to the state.

The Chief Minister was in London with a delegation for a two-week study trip to Britain, the United States and Canada before a final stop in Dubai, United Arab Emirates, to meet potential investors.

Abang Johari visited the University of London and Oxford University to explore possibilities of collaboration that would pave the way for Sarawakian students to be given places in various fields of study.

In the US, he will visit Stanford University to look at its research activities and facilities and assess the prospect of similar collaborations with the university and others in Silicon Valley.

Abang Johari said Sarawak would continue to send students overseas to pursue studies in new disciplines which are not available locally, such as cybersecurity, programming and data science.

“Sarawakians need to acquire new knowledge in order to be acquainted with the new ecosystem and development trends around the world,” he added.

Source: https://www.thestar.com.my/metro/metro-news/2018/09/28/cm-relays-swaks-oil-royalty-stand-to-students-overseas/

Abang Johari welcomes another ‘Chinese tsunami’

KUCHING: A “Chinese tsunami” supporting the ruling Barisan Nasional government in Sarawak in GE14 will strengthen the state’s pursuit to reclaim its rights and will demand Putrajaya’s attention.

Chief Minister Datuk Patinggi Abang Johari Tun Openg (pic) said there are big plans to spur development and economic growth in the state, and strong support from all Sarawakians – especially the Chinese community – is needed.

Sarawak Barisan won 25 out of the 31 parliamentary seats in the state in GE13, but Abang Johari is targeting at least 28 constituencies in GE14.

This would involve wresting Chinese-majority seats it lost such as Stampin, Bandar Kuching, Sarikei, Sibu and Lanang and Miri.

“We must have stronger representation in Parliament to fight for Sarawak rights,” Abang Johari said at the Sejiwa Senada programme at Batu Kawah here on Saturday.

The programme in Kuching is the fifth leg of the event after Miri, Saratok, Meradong and Sibuti. Next week, the Sejiwa Senada programme will be held in Lubok Antu. 

Sejiwa Senada is a free programme will give the public the opportunity to get services, information, and advice from government agencies, government-linked companies, NGOs and the private sector.

 
Abang Johari’s administration has lined up an agenda to transform the state economy. The state has embarked on building high-speed Internet facilities across the state as well as the Pan Borneo Highway project.

“Our new development approach is to embrace technology in all sectors, including agriculture.

He said modern farming methods would strengthen the rural economy, and create a diversity of agricultural products aimed at the global market,” he said.

Abang Johari also said that with the setting-up of Petroleum Sarawak Bhd (Petros), oil and gas royalties would be safeguarded working alongside Petronas.

He said that the additional revenue could support development of other projects such as a RM11bil LRT system across Kuching-Samaahan-Serian divisions, as well as a water grid project throughout the state.

“I promise to source more funds for Sarawak and we will assert our rights under MA63 (Malaysia Agreement 1963).

“We have to look into the future if we want to become a developed state by 2030,” Abang Johari said.

Abang Johari also mentioned plans to set up Sarawak’s very own television station in the future.

Source: https://www.thestar.com.my/news/nation/2018/05/05/abang-johari-welcomes-another-chinese-tsunami/

CM wants Chinese to rally behind state government

KUCHING: Datuk Patinggi Abang Johari Tun Openg says he needs strong support from the people to implement the plans he has for Sarawak.

A united front from all Sarawakians will send a strong signal to Putrajaya that the state is serious in reclaiming its rights, said the Chief Minister.

Abang Johari added he needed the people, in particular the Chinese community, to rally behind the state government to ensure the ruling coalition could put up a strong representation in Parliament.

“Sarawak people must unite and work together. This is the time to show that the Chinese in Sarawak are united and part of the ruling government,” he said at the Sejiwa Senada programme at Batu Kawah here.

Abang Johari added that his administration had lined up numerous initiatives to transform the state economy. The ongoing Pan Borneo Highway would have a multiplier effect to spur economic growth across Sarawak.

“Our new development approach is to embrace technology in all sectors including agriculture. Modern farming, research and technology in production including efficient logistics will help us penetrate the global market.”

Abang Johari (left) greeting Barisan Nasional candidate for Bandar Kuching Kho Teck Wan (right) while Stampin candidate Dr Sim Kui Hian looks on.

He said the setting up of Petroleum Sarawak Bhd (Petros) will ensure the state has strong participation in the oil and gas sector, working alongside Petronas.

The recent acquisition of 25% equity in LNG3 will give the state an extra income of about RM2bil next year, Abang Johari added.

Stronger participation and investment in the oil and gas sector will help the state support the RM11bil LRT project in the Kuching-Samarahan-Serian divisions, as well as the water grid project throughout Sarawak.

“I promise to source more funds for Sarawak and we will assert our rights under MA63 (Malaysia Agreement 1963).

“Petros will ensure Sarawak fully exploits its oil and gas resources,” Abang Johari said.

Abang Johari presenting a mock cheque for RM10,000 to Jimmy Chiang from the Kuching Spinal Injuries Association

The Chief Minister added Sarawak plans to have its very own television station in the near future.

At the event, Abang Johari presented a RM500,000 grant to SJKC Sam Hap Hin, an agreement letter for the relocation of SJKC Chung Hua Bako to Samarahan, as well as land ownership deed for expansion of SJK Chung Hua Mile 4 at Jalan Penrissen.

The Chief Minister also presented native customary rights communal reserve land titles to Kampung Giit in Padawan, Kampung Semadang, Siburan, and Kampung Gita Baru in Sungai Maong.

Petronas, under its corporate social responsibility initiative, presented a total of RM120,000 to 10 non-governmental organisations in Kuching.

Source: https://www.thestar.com.my/metro/metro-news/2018/05/07/seeking-communitys-support-cm-wants-chinese-to-rally-behind-state-government/

Bursa Malaysia well supported by fundamentals

KUALA LUMPUR: Maybank Investment Bank said Bursa Malaysia is well supported by sound domestic fundamentals despite the recent sell down stoked by the Dow Jones’s correction.

The investment bank said in a 1H 2018 Market Outlook session that it expects fiscal stimulus pre-GE14 and Bank Negara’s overnight policy rate (OPR) hike to be the two main thematics driving investment 

For the longer term play, it said the focus is on multi-year orderbook replenishment in infrastructure construction, tourism and Look East Malaysia.

It added that sectors that over “overweight” for 2018 are automotive, and oil and gas.

Fiscal stimulus in the lead up to the general election will be those in the consumer sector as boosts to disposal income is expected to continue and will be front laded in 1H2018. 

The OPR will benefit banks, while Maybank IB believes proven contractors will have the highest potential of winning jobs for the upcoming megaworks.

Among those the bank highlighted were Gamuda, IJM Corp, Sunway Construction and Cahya Mata Sarawak.

Meanwhile, the tourism theme is driven by an increase in higher quality/spend tourists and Visit Malaysia 2020. It noted the increase in tourist arrivals in two previous Visit Malaysia years.

“In 2007 and 2014, tourist arrivals surged +19% YOY and +7% YOY respectively, while tourism receipts grew +27% YoY, and +10% YOY respectively.”

Major construction activities are expected to lift economic activities for the Look East Malaysia theme. 

“For Sarawak, the Development Bank of Sarawak and PETROS (Petroleum Sarawak Bhd) and for Sabah, the Sabah International Petroleum Sdn Bhd are also catalysts. 

“Long term potential beneficiaries of this thematic are Cahya Mata Sarawak, Hock Seng Lee and KKB Engineering, Bintulu Port, Suria Capital and IJM Corporation,” said Maybank IB.

It added that its top picks for the year are IOI Corp, Hong Leong Financial Group, Gamuda, Yinson , Genting Berhad, Cahya Mata Sarawak, Bermaz Auto , YTL Hospitality REIT .

Geopoliticals risks, and financial imbalances and instability were highlighted by the bank as two key market risks that could detail sentiment. 

While volaitiy in the market will continue leading up to the GE14, the market will return to being driven by fundamentals, which are well supported by GDP and corporate growth expectations. 

Source: https://www.thestar.com.my/business/business-news/2018/02/13/bursa-malaysia-well-supported-by-fundamentals/

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