By DayakDaily Team
KUCHING, Feb 13: Puncak Borneo MP Datuk Willie Mongin asserted that the Petroleum Development Act (PDA) 1974 is invalid for Sarawak, as it was enacted while the Emergency Ordinance (EO) 1969 was in force, and thus ceased to be applicable after the EO was repealed in 2011.
Debating the Royal Address in Parliament yesterday (Feb 12), Willie urged the Madani government to rectify historical injustices, address the long-standing imbalance and ensure fairness in Sarawak’s oil and gas rights.
He emphasised that Sarawak’s Oil Mining Ordinance (OMO) 1958 remains legally valid, reinforcing the State’s authority over its petroleum resources.
He highlighted that since the repeal of the Emergency Ordinance, the legal foundation that allowed the federal government to assume control over Sarawak’s oil and gas has been removed, making it imperative for the current administration to rectify past injustices.
“Sarawak’s oil and gas rights cannot be taken away by manipulating the PDA 1974. Sarawak’s oil and gas resources have long been a crucial economic driver, yet Sarawak has not received its fair share. It is time for the federal government to acknowledge this and take corrective measures,” he said.
Willie also pointed out that Sarawak’s oil and gas industry should be governed under the OMO 1958, as it predates the PDA 1974 and remains in force, holding equal standing with federal laws under the Malaysia Act.
Willie cited Yang di-Pertuan Agong’s reminder that the federal concept—the foundation of Malaysia’s formation—must be respected, along with the full implementation of the Malaysia Agreement 1963 (MA63).
He also acknowledged Prime Minister Datuk Seri Anwar Ibrahim’s decision to officially recognise Petroleum Sarawak Berhad (Petros) as Sarawak’s sole gas aggregator, but questioned Law Minister Datuk Seri Azalina Othman Said’s recent statement suggesting that Petros’ authority does not extend to liquefied natural gas (LNG).
“The response from the Minister of Law contradicts statements made by the Prime Minister, the Premier of Sarawak, and Pengerang MP (Azalina) in Parliament,” Willie pointed out, seeking clarification on whether national oil corporation Petroliam Nasional Berhad (PETRONAS) is exempt from licensing under the Gas Distribution Ordinance (DGO) 2016 while still being required to comply with Sarawak laws.
He emphasised that MA63’s Inter-Governmental Committee (IGC) Report had recommended transferring legislative authority over electricity and gas distribution to Sarawak and Sabah, a provision that remains in force.
Willie explained that the Sarawak Legislative Assembly (DUN) passed the Gas Distribution Ordinance (DGO) in 2016, amended in 2023, allowing the Sarawak Cabinet to appoint Petros as the sole gas aggregator.
Sarawak, he stressed, never agreed that Petros’ role is limited to non-liquefied natural gas (LNG) businesses and maintains that it has the right to distribute and supply natural gas to LNG plants.
He highlighted that in PETRONAS vs. Sarawak Sales Tax Controller & Sarawak Government, the High Court ruled that PETRONAS must comply with Sarawak laws, including the Sarawak Sales Tax Ordinance.
“Since 2019, PETRONAS has been paying sales tax to Sarawak, demonstrating that it is not exempt from other written laws. Thus, PETRONAS must also comply with the DGO for gas distribution in Sarawak,” he said.
However, he informed the Sarawak government is open to considering an exemption for PETRONAS from obtaining a DGO license for non-distribution activities, as Petros remains the sole aggregator for supply and distribution.
This framework, he said, was acknowledged in MA63 negotiations, leading to the Exemption Order (Amendment) in 2019, which confirmed that federal approval under PDA 1974 is no longer required for gas marketing and distribution in Sarawak.
Willie outlined a structured role-sharing model between Petros and PETRONAS, with Upstream (Gas Production): PETRONAS, Midstream (Procurement, Distribution, and Supply): PETROS as the sole aggregator, and Downstream (LNG Production, Sales, and Export): PETRONAS.
“Under this framework, both the PDA and the DGO can coexist. So what is the issue? PETRONAS is not losing everything, nor is Petros taking over everything,” he said.
Under this framework, he dismissed claims that PETRONAS is suffering massive losses, stating that 94 per cent of approximately 4.5 billion standard cubic feet per day of Sarawak’s natural gas production is exported, while only 6 per cent is used domestically—a stark contrast to Peninsular Malaysia, where 100 per cent of its two billion standard cubic feet per day production is used domestically.
“Why shouldn’t Petros manage part of this 94 per cent to boost local industries, create jobs, and increase tax revenues for the country?” he questioned, emphasising that this imbalance must be addressed.
He called on Prime Minister Datuk Seri Anwar Ibrahim to use his authority over PETRONAS to ensure justice for Sarawak.
“The Madani government must demonstrate its commitment to justice and fairness by restoring Sarawak’s rightful control over its oil and gas.
“This is the time to act. We believe in your sincerity, and we know you can do this for the betterment of our country and for our collective prosperity.
“The people of Malaysia must recognise and respect the OMO 1958 (OMO 1958). Oil and gas activities in Sarawak fall under Sarawak’s jurisdiction. According to Item 8(J) of the Federal List, subject to Item 2(C) of the State List, PDA 1974 must be subject to Sarawak laws regarding production leases,” he added.
Willie stressed the need for a strategic plan for gas resource development that aligns with the Domestic Gas & Energy Mix Policies to attract investors to Sarawak as this will indirectly contribute to national prosperity through corporate taxes, positive economic spillover, and job creation. — DayakDaily
