Hornbill Unleashed

August 9, 2012

‘Najib willing to fulfill father’s word on Kelantan oil royalty’

Filed under: Human rights,Politics — Hornbill Unleashed @ 12:00 AM
Tags: , , ,

Hafiz Yatim

Prime Minister Najib Abdul Razak is well on the way to fulfilling his father’s promise to give oil royalty to Kelantan, Minister in the Prime Minister’s Department Nazri Abdul Aziz said today.

He added that the committee appointed by the government to review this issue with regard to the east coast states of Peninsular Malaysia, showed the premier’s sincerity.

“The committee will hold discussions and further announcements will be made after Najib meets the attorney-general. Probably tomorrow the matter will be discussed further,” he said.

Nazri added that there are certainly pros and cons to the issue and the federal government hoped the committee would help put the issue at rest.


“Najib is not fulfilling it because of PAS demands. He is willing to consider fulfilling what his late father, second prime minister’s Abdul Razak Hussein, had said in the Dewan Rakyat in the 1970’s, that payments will be made for oil found off-shore.

“Based on this, in my opinion, Najib feels there is a need for finality to this matter.”

The committee as announced by the government is chaired by former Chief Justice Abdul Hamid Mohamad.

Members of the committee would comprise legal experts from within and outside the country, and representatives from the Pahang, Kelantan and Terengganu governments.

When asked who else was on the committee, Nazri said he did not know but it could be decided when the cabinet met next.

On claims by the opposition that they will increase the oil royalty payment to 20 percent compared to five per cent as present in states like Sabah and Sarawak should Pakatan Rakyat wins, Nazri said oil is a precious resource like gold, and that the mining was done by the federal government.

“The five per cent oil royalty to states is a normal rate adopted in other countries and there is no need to increase it to 20 percent. The five per cent is based on world standard and should be sufficient,” he said.

Better late than ever

While Terengganu gets oil royalty, Kelantan has been seeking it for quite a while.


Last November, it was reported that Kelantan senior exco member Husam Musa, said in 1975, the second premier had answered the then 34-year-old MP Lim Kit Siang that states which are signatories of the Petroleum Act 1974, would see royalty paid even if oil was found offshore.

Quizzed as to why the government had decided to fulfill its obligations now, although the Kelantan government had sought it since 2002, Nazri said that was something for Najib to clarify.

“However, as the adage goes, better late than ever.”

Gua Musang MP Tengku Razaleigh Hamzah (right), who was the first Petronas chairperson, has been pressuring the federal government to pay the royalty as it was Kelantan’s right.

The Kelantan PAS led government had also filed a commercial suit in 2010 suing Petronas for non-payment of oil royalty. The case is still pending in court.

Oil is extracted from four identified areas – in Kelantan; Kelantan-Thailand which forms part of the (Joint Development Area between Malaysia-Thailand); Kelantan-Vietnam (Joint Development Area between Malaysia-Vietnam); and the Kelantan-Terengganu border.



  1. Tun Razak’s word is not an ‘amanat’ at all. Oil royalty for Kelantan should have been paid from the very start that Petronas has found oil and gas in its territory. Is it another janji ditepati after 37 years since the signing of the Agreement or another political stunt by najib to hoodwink malay voters in the eastern states since GE13 is around the corner?

    The Kelantanese together with the rest of malaysians are not fools. Nazri………..”better late than ever” sounds to me like an umno’s punishment for kelantanese. That shows a really bad governance and has deprived them of their social and economic well-being for too long. If the oil royalty has been given to PAS government, I’m pretty sure Kelantan could have been developed into one of the richest states in Malaysia.

    Najib, I suggest that you stop your ‘day-dreaming’ to win back Kelantan and I’m not surprise Terangganu will fall again into the hands of PAS/PAKATAN government after GE13. To much ‘janji ditepati’ will spoil the soup.

    Comment by Justice Lover — August 9, 2012 @ 10:22 PM | Reply

  2. In an interview with The Malaysian Insider on March 20, 2010, Gua Musang MP Tengku Razaleigh Hamzah (pic above) claimed he was told that the national oil company, Petronas, has made a “very big discovery of an oil field, probably the biggest in the world”. This discovery, he asserted, meant that Petronas would have a very good future. However, the founding chairman of Petronas declined to go into details. “I was told… no announcement (was) made (about) a very big discovery of oil. I was told there was a big discovery… which could depress the oil price.“I was also told it is the biggest oil field or oil well (not only) in this part of world but also in any part of the world. “I cannot disclose the (location)… I cannot tell you,” he said when asked repeatedly about the discovery, which he mentioned in his talk titled, “Oil Royalty: A Constitutional Right?” organised by the Malaysian Bar here today. (Informed sources tell The Scribe that the location of this Mega Oil Field is in Kelantan). He also did not identify who had told him of the developments in Petronas. Meanwhile, Petronas, in a brief statement, denied any such discovery.

    On Thursday, June 12, 2008, The Scribe wrote about Huge Oil & Gas Reserves Found In Kelantan. This issue is now highlighted in the news every other day. Seriously, there are oil and gas in Southern Thailand and North Terengganu, IS KELANTAN SO UNLUCKY TO HAVE NO OIL/GAS WHEN SANDWICHED BETWEEN THIS TWO RICH FIELDS? For this reason, The Scribe has decided to repost this Article.

    Kelantan wants its portion of the oil royalty amounting to RM1 billion from the area jointly developed by Malaysia and Thailand.

    The money would be used to develop the Bachok Special Economic Zone, which includes a project to supply electricity to Southern Thailand.

    Producing a copy of the agreement signed between the Kelantan state government and Petronas dated May 9, 1975 under the Petroleum Development Act 1974 Petroleum Development Act 1974), Kelantan senior exco Datuk Husam Musa said today there was no reason for the federal government not to pay Kelantan its dues.

    The signatories to the agreement were the then menteri besar Datuk Mohamed Nasir and Petronas chairman Tengku Razaleigh Hamzah.

    The agreement stated that in return for ownership and the rights, powers, liberties and privileges, Petronas shall make cash payments of the sum amounting to 5% to the Kelantan government. The cash payments were to be made semi-annually, in March and September.

    Prior to PDA 1974, the rights to extract oil and gas were vested exclusively in the Malay Sultans. All states were made to sign the agreement under the Act back in 1975. Terengganu which signed the agreement enjoyed 22 years of oil royalty until it was stopped in 2000 when PAS took over the state after winning the 1999 general election.

    According to Husam, there was also no issue of overlapping claims, as the PDA 1974 was clear on that the state has a claim in royalty to the oil and gas found both onshore and off shore.

    Comment by Mata Kuching — August 9, 2012 @ 7:21 PM | Reply


    That was 37 years of UMNO plunder of Sabah Sarawak oil to develop Malaya at our expense!

    Comment by Abang — August 9, 2012 @ 1:13 PM | Reply

  4. We have see more than enough wayang from BN and Umno, don’t cheat the nation anymore lah..please…step down quietly during the GE 13 !!!

    Comment by Mike- Johor — August 9, 2012 @ 10:31 AM | Reply

  5. Don’t use the excuse ” mining done by Federal Government”. Also ” 5% based on World Standard” prove it ! You people are stealing our Oil money and yet you are acting so arrogant . WTF, we don’t need people like you to teach us what is ours and what are our rights. All the Parties in BN Sarawak, can’t you people see how Sarawak is being treated ? Why you so called elected leaders are not making a stand to seek better equality for Sarawak. Either you people have no balls or you people are under UMNO pay-roll.

    Comment by gagojackman — August 9, 2012 @ 10:28 AM | Reply

  6. Nazri is abetting BN in stealing money from Sabah and Sarawak. His rationale about the Federal government doing the drilling lame excuse for exploiting the other two countries with equal atatus with Malaya. Such injustice rendered to us will no more be tolerated and it will lead to the demise of BN in Sabah and Sarawak eventually.

    Comment by Egbert Lau — August 9, 2012 @ 3:00 AM | Reply

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