Lo: ConocoPhillips exit provides chance for Sarawak to reclaim greater control over oil and gas future
KUCHING (May 2): Batu Kitang assemblyman Lo Khere Chiang opines that ConocoPhilips' withdrawal from the Salam-Patawali deepwater project serves as a long-overdue opportunity for Sarawak to take greater control of its economic future.
The Sarawak United Peoples' Party lawmaker said the project is still in the feasibility stage.
'This is precisely why ConocoPhillips is able to exit the venture with Petronas at this point. However, the door to future investment in Sarawak is not closed.
'It could very well remain open for ConocoPhillips to re-engage, this time with Sarawak represented by Petros and on terms that are fairer for Sarawak,' he said in a statement today.
The statement was issued in response to recent reports on ConocoPhillips' withdrawal from the Salam-Patawali deepwater project, sparking concerns about investor confidence in the state's growing role in the oil and gas sector through Petroliam Sarawak Berhad (Petros).
Lo said a more balanced structure could take the form of a 50:50 joint venture between Sarawak and ConocoPhillips, with this, Sarawak might still allocate five per cent to the federal government.
For over 50 years, he said Sarawak had received only a five per cent cash payment from oil and gas revenue under the Petroleum Development Act (PDA) 1974, which was enacted during the Emergency period and was never passed by the Sarawak State Legislative Assembly.
Despite contributing billions to the national coffers, he said Sarawak had lagged behind in infrastructure and development.
'Federal budget allocations have remained disproportionately small, especially when measured against Sarawak's vast landmass and complex logistical needs,' he said.
Lo said while Sarawak awaits the court's decision on its legal challenges to the validity of the PDA, it is important to note that the state has its own Oil Mining Ordinance (OMO) 1958, which predates the PDA and forms the legal foundation for Sarawak's assertion of regulatory control over its resources.
Regardless of the outcome in court, he said Sarawak deserves a much greater role in managing and benefiting from its own natural resources.
'If Petronas can form joint ventures and operate oil fields, then so can Petros, with proper capacity-building and strategic partnerships. In many joint ventures, even when Petronas holds a 50 per cent stake, the actual operational work is still carried out by international companies like Shell or ConocoPhillips.'
Lo said if ConocoPhillips chose to step away, others will come, especially if Sarawak remains open to international investors and offers a transparent, fair and mutually beneficial investment climate.
'This is why Premier Abang Johari's call to ignore the cynical voices of outsiders is not only justified, it is essential. Under his leadership, the GPS government is advancing strategies that are sound, forward-looking, grounded in integrity and aligned with Sarawak's long-term interests,' he said. ConocoPhillips Lo Khere Chiang oil and gas industry Petros
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
.jpg&w=3840&q=100)
Daily Express
6 hours ago
- Daily Express
Recording a new milestone in journey to success
Published on: Monday, August 18, 2025 Published on: Mon, Aug 18, 2025 By: Leonard Alaza Text Size: Hunai Jaya is the latest industry player to join the VDP, aimed at empowering Bumiputera vendors to build resilience and sustainability. Kota Kinabalu: Since its inception in 2016, Hunai Jaya Resources Sdn Bhd has steadily grown into a formidable player in the local oil and gas services and equipment (OGSE) industry. The Sabah-based company built its legacy by prioritising quality and reliability, ensuring customer satisfaction remains at the forefront of its operations. This commitment to excellence has paved the way for its inclusion in PETRONAS' Vendor Development Programme (VDP), a significant milestone for the company. Gaining recognition and building momentum Hunai Jaya's formative years were focused on developing their core competencies and strengthening their operations through workforce upskilling and building strategic partnerships. 'As we gained recognition in the electrical and instrumentation fields, our dedication to sustainability and innovation allowed us to expand our service offerings and customer base,' said Hadida Hadi, the company's director. Today, Hunai Jaya has diversified its offerings to include oil and gas engineering maintenance, instrumentation validation and calibration services, civil construction and building maintenance, marine consultancy, grass-cutting services and manpower supply. Reflecting on its early days, Hadida recalled the initial challenges that the company faced upon its establishment. Hunai Jaya's collaboration with PETRONAS began as early as 2016 with its first project at PETRONAS Chemicals Fertiliser Sabah Sdn Bhd facility in Sipitang, where they supplied general workers. 'This marked the beginning of our journey in manpower supply, meeting PETRONAS' standards. As many experienced professionals sought opportunities abroad, one of our early challenges was sourcing semi-skilled and skilled workers. 'To address this, we expanded recruitment beyond local districts and provided housing facilities to ease workers' transition. We also prioritised safety training and regulatory compliance, ensuring our workforce was well-prepared to meet industry demands,' Hadida said. Since then, Hunai Jaya has worked for PETRONAS to construct and maintain petrochemical plants, offshore platforms and pipelines, and offer consultancy, design solutions and feasibility studies for industry projects. Hunai Jaya's workforce has also expanded to over 200 employees engaged in various projects. Levelling up At the Sabah Commemoration Day in Kota Kinabalu earlierthis year, PETRONAS welcomed Hunai Jaya as the latestindustry player to join its Vendor Development Programme (VDP), marking a significant milestone in its growth journey. Since 1993, VDP has empowered Bumiputera vendors to build resilience and sustainability, with 21 Sabah vendors appointed to date. The programme focuses on enhancing technical competence, commercial viability and homegrown innovation while fostering growth and paving the way forinternational expansion, including potential listing on Bursa Malaysia as a long-term objective. When asked on the decision to embark on this prestigious programme, Hadida highlighted several key factors that drove Hunai Jaya's motivation to participate in VDP. 'Apart from providing us access to resources, technology and increased market visibility, VDP also fosters collaboration with industry players, allowing us to forge strategic partnerships while encouraging best practices and innovation. 'This commitmentto continuous improvement aligns with our dedication to operational excellence and long-term growth,' said Hadida. Hunai Jaya hopes to leverage its experience as a VDP vendor, acknowledging that it was initially challenging to meet the programme's requirements and determine their eligibility. 'Through active internal and external engagements with VDP representatives and our workforce, we managed to overcome these challenges and strengthened our capabilities in positioning Hunai Jaya for long-term growth in the oil and gas sector,' Hadida said. Commitment to environment and society As a VDP participant for liquefied petroleum gas (LPG) cylinder maintenance, Hunai Jaya demonstrated its commitment to sustainability by supporting PETRONAS' sustainability aspirations, including the Net Zero Carbon Emissions (NZCE) by 2050 agenda. 'We adopt sustainable maintenance practices, prioritising eco-friendly and energy efficient methods to reduce energy consumption. We also support NZCE goals through the maintenance of LPG cylinders, thereby enhancing the safety and efficiency of LPG use, promoting a lower-carbon energy solution,' Hadida adds. On the social front, Hunai Jaya remains committed to empower localtalent, create job opportunities and enhance local workforce capabilities in LPG cylinder maintenance. 'We aim to prioritise hiring 100 per cent local Sabahans across our operations and support local suppliers by sourcing our materials and services from them, ensuring employment opportunities for the regional workforce and contribute to economic stability in the State. 'Apart from investing in employee upskilling through industry-specific training to enhance their capabilities in the OGSE sector, we also invest in local infrastructure development, where our projects contribute to improvement ofroads, utilities and facilities that benefit the community,' Hadida said. Looking ahead As a newcomer to the VDP and despite the initial challenges that Hunai Jaya encountered, Hadida is optimistic that the company's participation in the programme will be invaluable in enhancing operational efficiency, driving innovation and ultimately support industry growth. 'Through VDP, we aim to enhance our capabilities, contribute to industry growth and achieve long-term success. We are committed to making the most of the programme's opportunities and look forward to advancing our journey with VDP,' Hadida said. The collaboration between Hunai Jaya and PETRONAS through VDP will support Hunai Jaya's aspirations to continue becoming a trusted industry partner, reaffirming their commitment to delivering exceptional value and contributing towards the success of their customers and the wider community. Meanwhile, PETRONAS and the Sabah Government continue to drive significant progress in strengthening the state's oil and gas industry, fostering economic growth and expanding local vendor participation. This aligns with PETRONAS' commitment to supporting the Sabah Government and industry partners in realising the state's aspiration of becoming a regional oil and gas hub. * Follow us on our official WhatsApp channel and Telegram for breaking news alerts and key updates! * Do you have access to the Daily Express e-paper and online exclusive news? Check out subscription plans available. Stay up-to-date by following Daily Express's Telegram channel. Daily Express Malaysia
Borneo Post
2 days ago
- Borneo Post
Sarawak's O&G rights indisputable, says Pujut rep
Yii says Sarawak's rights in this sector are not federal concessions, but legacy entitlements grounded in the state's legal and historical foundations. MIRI (Aug 16): Pujut assemblyman Adam Yii has reaffirmed that Sarawak's control over its oil and gas resources is rooted in historical fact, legal rights and state dignity, stressing that the Petroleum Development Act 1974 (PDA) cannot override Sarawak's own oil laws. In a statement, Yii has expressed firm support for Senator Ahmad Ibrahim's assertion that the PDA does not supersede the Oil Mining Ordinance 1958 (OMO), which remains valid and enforceable in Sarawak. According to the Miri Mayor, Sarawak's rights in this sector are not federal concessions, but legacy entitlements grounded in the state's legal and historical foundations. 'Sarawak began oil extractions in Miri in 1910, decades before Malaysia was formed in 1963. 'The OMO, enacted by the British colonial administration, remains in force and is protected under Section 73 of the Malaysia Act 1963.' Yii added that any attempt to disregard or downplay these rights would constitute a serious affront to Sarawak's sovereignty. Yii described as 'highly misleading' a recent statement in Parliament by the Minister in the Prime Minister's Department for Law and Institutional Reform, who claimed that Petronas' powers under the PDA extended to Sarawak 'Such statements risk creating public misunderstanding and falsely suggest that Sarawak has compromised its longstanding position,' he said. Yii highlighted Sarawak's significant progress in asserting its rights through legislative and legal means. In 2016, the Sarawak government passed the Distribution of Gas Ordinance (DGO), officially recognising Petroleum Sarawak Berhad (Petros) as the sole gas aggregator in the state. In 2020, the High Court ruled in favour of Sarawak's right to impose a sales tax on petroleum products, forcing Petronas to pay outstanding dues to the state. 'These were not acts of generosity from the federal government. They were rights that Sarawak fought for and won through the courts and legislative reforms,' stressed Yii. He also called upon all political parties and leaders in Sarawak to adopt a united stance in defending the state's rights, and to reject any attempts to undermine it. 'This matter is not merely economic, but one of dignity, legal autonomy, and the spirit enshrined in the Malaysia Agreement 1963 (MA63), which forms the basis of Sarawak's participation in the Malaysian federation. 'SUPP will never yield. We will continue to defend Sarawak's rights at the negotiating table, in Parliament, and in the court of public opinion. 'Sarawak's oil and gas resources belong to Sarawakians. That is an indisputable historical fact and a right protected by law.' adam yii lead MA63 oil and gas OMO PDA
Borneo Post
2 days ago
- Borneo Post
Fadillah: Only business negotiations left in Petronas–Petros Gas deal
Fadillah fields questions from reporters at the event. – Photo by Chimon Upon KUCHING (Aug 16): Commercial negotiations between Petronas and Petroleum Sarawak Berhad (Petros) are still ongoing and are expected to be concluded soon, although no specific timeframe has been set. Deputy Prime Minister Dato Sri Fadillah Yusof said the basis of agreement had already been established through a joint declaration between the federal government and the Sarawak government. 'The declaration has already been made (finalised) in which the Prime Minister and the Sarawak Premier clearly agreed that federal and state laws must go hand in hand. 'The Federation cannot disregard Sarawak laws, and likewise, Sarawak cannot disregard federal laws. So that has already been agreed upon in the declaration,' he said when met after officiating the MySalam 3K (Finance, Health and Welfare) Petra Jaya programme at the Kampung Samariang Batu Community Hall here today. He was responding to a statement by Minister in the Prime Minister's Department (Law and Institutional Reform) Datuk Seri Azalina Othman Said in Parliament on Friday, who said that Petronas and Petros have yet to finalise the terms and mechanisms for implementing the joint declaration on gas distribution, even though nearly three months have passed since it was signed. Azalina reportedly said both parties were still discussing details of the cooperation framework based on agreed principles, in line with commercial considerations. Fadillah further explained that what remains unresolved are only the administrative and commercial negotiations between Petronas and Petros. 'The declaration is already there. What has yet to be finalised are the business negotiations between Petronas and Petros. These are still ongoing, and that is the current situation. 'So yes, they are still negotiating,' he said. Fadillah stressed that although no timeline has been set, the government hopes the negotiations can be concluded quickly to facilitate investment and business operations both offshore and onshore. 'That is what we want to expedite because it will make it easier for industry players to carry out their daily activities,' he said. Prime Minister Datuk Seri Anwar Ibrahim and Sarawak Premier Datuk Patinggi Tan Sri Abang Johari Abang Openg signed the Joint Declaration on May 21, which formed the basis for establishing a cooperation framework between Petronas and Petros. The declaration also outlined key principles of alignment, such as ensuring all Federal and Sarawak State laws related to gas distribution within Sarawak coexist and are respected by all parties engaged in such activities in the state. In addition, the declaration stated that Petronas will continue to carry out its roles and responsibilities as provided under the Petroleum Development Act 1974 (Act 144). Petros, meanwhile, has been appointed as the gas aggregator for Sarawak's domestic market effective March 1, 2025, and this appointment will be respected by all industry players involved in gas distribution and supply to domestic consumers. As for the liquefied natural gas (LNG) business, Petronas will continue its role and responsibilities across the entire upstream value chain through to the sale of LNG to international markets, and all existing agreements or arrangements between Petronas and/or its subsidiaries with third parties for LNG sales (from upstream to export) will remain intact and in force. Meanwhile, in his speech, Fadillah said the Petra Jaya 3K Carnival 2025 was an important platform to engage with the people, listen to their voices, and share information on various government initiatives in a direct, open, and inclusive manner. This approach, he said, was in line with the Madani spirit which emphasises well-being, justice, and inclusiveness. According to him, the government has always focused on the lower-income (B40) group who are more vulnerable to the pressures of the cost of living. 'In line with this, various assistance programmes have been implemented to ease the burden and improve the well-being of the people. Among them are the Rahmah Cash Contribution (STR), Cost of Living Aid (BSH), PeKa B40, the People's Housing Project (PPR), and the Rahmah Basic Contribution (SARA). 'In fact, one important initiative I wish to highlight today is mySalam, a free health protection scheme for the B40 group which provides financial assistance and hospital treatment for critical illnesses,' he said. For the record, he added, mySalam has so far assisted more than 1.74 million Malaysians, including in Sarawak, with claim payouts exceeding RM1.25 billion. fadillah yusof negotiation oil and gas Petronas Petros
