By Karen Bong
KUCHING, Dec 16: Negotiations between Petroliam Nasional Berhad (PETRONAS) and Petroleum Sarawak Berhad (PETROS) on a commercial settlement are progressing, with formal correspondence already underway and an outcome expected as early as next year.
Deputy Prime Minister Datuk Amar Fadillah Yusof said both the Prime Minister Datuk Seri Anwar Ibrahim and Sarawak Premier Datuk Patinggi Tan Sri Abang Johari Tun Openg had agreed that a commercial settlement was the most practical and constructive approach for resolving issues between PETRONAS and PETROS.
“If you go along the interpretation of the laws, there will be a longer and more complex settlement because you have to go through court processes and so on. At the end of the day, it may not be win-win, but lose-lose for all parties,” he said at the 2026 Sarawak Budget Conference at the Borneo Convention Centre Kuching (BCCK) today.
Instead, Fadillah explained that both national and State leaders had agreed for PETRONAS and PETROS to sit down together and identify areas where they could collaborate, stressing that cooperation would ultimately benefit not only the companies involved, but also the nation and the wider business community.
“This win-win approach is what we have agreed on. There is already correspondence between PETRONAS and PETROS, and hopefully by early next year we should be able to know the result from the negotiation, which is currently still ongoing,” he said.
However when met by members of the press later, he cautioned that if the two parties were unable to reach an agreement, legal avenues could still be pursued, though he expressed hope that this could be avoided.
Speaking during a forum session titled Exploring Sarawak’s Future: The Fourth Madani Budget and 13MP as Catalyst for Growth, Minister of Finance II Senator Datuk Seri Amir Hamzah Azizan echoed the importance of cooperation, describing the oil and gas sector as a critical pillar of Malaysia’s and Sarawak’s economy.
He noted that PETRONAS had invested an estimated RM290 billion over the years to develop the oil and gas sector, while Sarawak had received close to RM80 billion in returns through royalties, dividends and spin-offs, including equity participation in Bintulu Port.
“The key was that this worked because there was an attitude that we must work together. From exploration to development, export and downstream manufacturing, the entire supply chain must be secured. That has proven to be the winning formula for Malaysia,” he said.
Amir said this principle had also been anchored in the understanding reached between the federal and Sarawak governments, urging both sides to focus on practical solutions rather than allowing tensions to escalate.
“The worst thing that can happen when there is friction is that people lose trust in our system. When they lose trust, they don’t invest and that’s a lose-lose position that we really don’t want to go down,” he said.
He added that both sides had also agreed in principle to make more gas available for domestic utilisation in Sarawak, strengthening the State’s infrastructure and its ability to attract industries and enhance economic complexity.
“This engine must continue moving forward. If it is interrupted, our aspirations to raise economic complexity will also be affected,” he said, expressing optimism that “cooler heads will prevail” given the understanding reached at the highest leadership level between the Prime Minister and the Sarawak Premier. — DayakDaily
