Petronas dispute: Sarawak ‘must have a say’ on production of oil and gas within state, says Premier Abang Johari

SINGAPORE: Sarawak’s Premier Abang Johari Openg said that the state has the power to make decisions over the distribution of oil and gas resources within its territory.

This comes about a week after the Malaysian government signalled that national oil corporation Petronas will remain the sole guardian of the country’s oil and gas reserves – including in the Borneo state. 

While Sarawak “accepts” Malaysia’s Petroleum Development Act (PDA) 1974 – which stipulates that Petronas has exclusive control over exploration and distribution of the country’s oil and gas resources in Malaysia – Abang Johari emphasised that the Borneo state “must have a say”. 

“That’s why we formed Petroleum Sarawak Berhad (Petros) and Petros will work together with Petronas … And we have a say in the distribution of gas,” he was quoted as saying by The Borneo Post in an interview on the sidelines of a public lecture at Singapore’s ISEAS-Yusof Ishak Institute on Monday (Feb 10).

“Lately, Prime Minister of Malaysia (Anwar Ibrahim) has agreed that Petros is to be the aggregator of gas (in Sarawak).” 

In a meeting between the two on Jan 7, Anwar had said that while Petros had authority as a gas aggregator, both the firm and the Sarawak government had agreed that it would not interfere with Petronas’ role and operations under the PDA, state news agency Bernama reported. 

In a parliamentary reply on Feb 4, Minister in the Prime Minister’s Department (Law and Institutional Reform) Azalina Othman Said said that Petronas’ recognition of Sarawak government-owned Petros as the state’s gas aggregator excludes liquified natural gas (LNG). 

This marked a huge setback for Sarawak in its bid for more control over its natural resources.

CNA reported earlier that Azalina’s statement has caused unease with Abang Johari, who has in turn asked Deputy Prime Minister Fadillah Yusof to deal with the situation at the federal government level.