Hornbill Unleashed

July 6, 2017

Great hopes from PM’s royalty promise

Filed under: Politics — Hornbill Unleashed @ 8:02 AM

The promise by Prime Minister Datuk Seri Najib Tun Razak that the federal government will give utmost consideration to Sarawak’s request for higher gas and oil royalty has received all round approval from both sides of the political divide in the state.

Parti Rakyat Sarawak (PRS) president Tan Sri Datuk Amar Dr James Jemut Masing hoped that the federal government would meet the appeal brought up by Chief Minister Tan Sri Datuk Amar Adenan Satem in his speech during the Malaysia Gawai Open House in Miri Monday night.

Masing added Sarawak needed that extra fund as many areas in the state were still in dire need of development.

“I am very happy to note that the federal government is willing to consider Sarawak’s request for a 15 per cent increase in oil and gas royalty.

“I must congratulate the Chief Minister for being able to bring all the state’s elected representatives, from both political divide, to request for the royalty to be increased to 20 per cent,” he said when contacted yesterday.

Masing praised Adenan for making the request as oil royalty had been a long standing issue between the state and federal government.

“It hasn’t been done before. May this be the start of what is to come. Together we should stand as one when Sarawak’s interests are at stake.

“Political differences among YBs (elected representatives) must be put aside, and Sarawak’s interests to the front.”

Meanwhile, Balai Ringin assemblyman Snowdan Lawan was also thankful to Najib for his positive response to the state’s request.

“Sarawak is a big state and needs bigger funds to develop it comprehensively.”

“Our hope is that it (royalty increment) could be made a reality soon.”

Meanwhile State PKR vice chairman See Chee How said it was not enough for the federal government to just consider increasing the oil and gas royalty to 20 per cent for the state. It must set a deadline for discussion on the payment.

He added that the state should look beyond royalty as it should also ask for its share of ownership through sovereign wealth fund in downstream industries such as contracts for infrastructure facilities and all forms of maintenance support.

He added that Sarawak must demand for equity shares and direct participation in the Production Sharing Contracts (PSCs) involving exploitation and production of oil and gas and related products in the state.

“We call on the state government to demand for such equity holdings through state-owned sovereign wealth fund when the PSCs are up for negotiation for extension of their usual 15 or 20 years term.

“It is not fair for oil-producing states to get nothing except royalties,” he told a press conference here yesterday.

See added that the state’s participation in the downstream industries was only about five per cent through Petronas Carigali Sdn Bhd.

“Therefore, we call on the government to reveal the number of PSCs signed between Petronas and PSC contractors in Sarawak, the total value of PSCs affecting Sarawak, the equity holdings of Sarawak in these PSCs at present, the value of entitlements of Sarawak in the profits of these PSCs, the equity holdings of Sarawak in PSC downstream industries as well as the value of entitlements of Sarawak in the profits of these PSC downstream industries.”

See was wary of the royalty being paid in the form of development funds.

“In principle, we should not agree to the payment of the royalty in the form of development grants. The federal and state governments must be clear with the distinction of these two.

The royalty is the state’s entitlement of rights, while development grants are typical handouts from the federal government.”

If the state government were to agree with the federal government to make the royalty payment in the form of development grants, the Sarawak State Legislative Assembly must be shown audited accounts of such payments and be ensured that the additional payment of oil and gas royalty are over and above the present development grants allocated to the state, he said.

Source : The Borneo Post Online By Mahathir Haroun & Antonia Chiam



1 Comment »

  1. Election gimmick. The so called increase of 15 % shall be in the form of capital contributions to Petros, Sarawak ‘s own upstream and downstream oil and gas corporation.tros. stop dreaming.

    Comment by Sabri Yaman — July 6, 2017 @ 9:55 PM | Reply

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