Sarawak continues pursuing O&G demand from Putrajaya

E11 Platform Complex, Baronia oilfield in Miri. — file pic

KUCHING, Oct 31: Sarawak government has not dropped the 20 per cent oil and gas royalty demand from its federal counterpart.

The Chief Minister’s Office (CMO) said the state is continuing with its negotiation with the federal government.

“Reference is made to an article published today on The Star online news portal and various other portals suggesting that Sarawak is dropping the 20 per cent oil royalty demand from the federal government.

“This office wishes to clarify that the Sarawak government has not dropped the demand and the current negotiation with the federal government is based on the demand. The article is misleading and vexatious in intent,” CMO said in a statement.

The article in reference is a Reuters’ story with the headline “Sarawak to drop demand for Petronas royalty hike”.


The article reported that Sarawak will drop a demand for quadrupling royalties paid by Petronas but is pushing for production sharing and other commercial settlements.

Sarawak Legal Advisor Datuk Seri JC Fong was quoted as saying that the state accounted for two-thirds of Malaysia’s total gas production and almost one-third of the oil produced, and should be given a bigger share in Petronas profit.

“They now say they can’t afford it, it will bankrupt Petronas and all that, so of course, we have to find the alternation solutions for them to get out of this failure to fulfil the electoral promise.

“The alternative is a commercial solution. That does not hurt them too much in terms of their cash flow, but allows us to have a fairer share of the revenue and more participation and so o and so forth,” he added. — DayakDaily