Finalise Petros and PETRONAS collaboration swiftly, says S'wak Yang Di-Pertua
Sarawak Yang di-Pertua Negeri Tun Dr Wan Junaidi Tuanku Jaafar (third left) inspecting the guard of honour at the opening ceremony of the Sarawak Legislative Assembly meeting on Monday (May 19). - ZULAZHAR SHEBLEE/The Star
KUCHING: The collaboration between Petroleum Sarawak Bhd (Petros) and PETRONAS should be finalised swiftly, says Tun Dr Wan Junaidi Tuanku Jaafar.
The Sarawak Yang di-Pertua Negeri said this would benefit the development of the oil and gas industry in Sarawak for the mutual prosperity of the state and nation.
"I'm thankful that the Prime Minister and Federal Government have agreed to the Sarawak government's move to appoint Petros as the sole gas aggregator in the state under the Distribution of Gas Ordinance," he said while opening the Sarawak Legislative Assembly's first meeting this year on Monday (May 19).
Wan Junaidi said Sarawak has the executive and legislative power to make state laws on electricity and gas distribution.
He said this aligns with the recommendation of the Inter-Governmental Committee (IGC) Report 1962, implemented through the Borneo States (Legislative Power) Order 1963 made by the Yang di-Pertuan Agong in accordance with Article 95C of the Federal Constitution.
"This constitutional right should be respected to enable Petros to carry out its gas aggregator role and ensure that the development of the gas industry in Sarawak contributes to the national and state economy," he said.
Last week, Sarawak Premier Tan Sri Abang Johari Openg said an agreement involving Petros and PETRONAS would be announced soon, which would recognise both federal and state laws and acknowledge Petros as the sole gas aggregator in Sarawak.
He said Sarawak would also increase its stake in liquefied natural gas through a commercial agreement.
Wan Junaidi also expressed appreciation for the close ties between the Federal and Sarawak governments, saying various issues involving Sarawak's rights and interests had been resolved as a result.
"I hope all of Sarawak's demands enshrined in the Malaysia Agreement 1963, IGC Report, and Federal and state constitutions can be resolved speedily to benefit the state and nation.
"I also urge the Federal Government to fulfil its responsibility towards the socioeconomic development and security of Sarawak," he said.
Earlier, Wan Junaidi inspected a guard of honour comprising 105 police personnel during the opening parade.
They were accompanied by a police band which played the national and state anthems.
Before the Head of State's opening address, the state assembly observed a minute's silence for the late former prime minister Tun Abdullah Ahmad Badawi and former Serian MP Datuk Amar Dominic Dago Randan.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Borneo Post
an hour ago
- Borneo Post
Revisit true meaning of federalism, those critical of Sarawak reclaiming autonomy told
Wilfred Yap – Photo by Chimon Upon KUCHING (June 11): Those who feel threatened by Sarawak's rightful autonomy should revisit the true meaning of federalism because a strong Malaysia must be built on mutual respect and genuine partnership among all its constituent states, including Sarawak and Sabah, said Kota Sentosa assemblyman Wilfred Yap. In this respect, he defended the state's growing role in managing its own gas resources as he reminded critics, particularly politicians from Peninsular Malaysia, that Sarawak's push for autonomy was not about defiance, but about fairness and reclaiming rights that were promised to Sarawak under the Malaysia Agreement 1963 (MA63). 'Our actions reflect this very spirit that is a commitment to a more balanced and equitable Malaysia for all,' he added in a statement yesterday, in which he was responding to recent remarks by several Malayan politicians who attempted to link the federal government's recognition of Sarawak's role as the sole gas aggregator to the retrenchment of some 5,000 Petronas employees. Yap thus described such accusations as 'baseless and misleading', stating that they either stemmed from ignorance or 'a deliberate distortion of MA63'. He also said that it was irresponsible to suggest that Sarawak's rightful empowerment was a political ploy to appease so-called 'threats'. 'These claims insult Sarawakians' intelligence and misrepresent our legitimate aspirations for greater control over our resources,' he said. Yap also stressed that Sarawak's demands were constitutionally grounded and long overdue, having been sidelined for decades since the formation of Malaysia. He also rebutted the suggestion that empowering Petros, the state-owned oil and gas company, could jeopardise national interests, calling such views 'insulting, and a mischaracterisation of Sarawak's pursuit of economic self-reliance'. On the issue of Petronas retrenchments, Yap pointed to a statement by the company's president and chief executive officer Tengku Muhammad Taufik, who made it clear that the layoffs were part of a broader restructuring in response to global energy transitions and not because of Sarawak's growing role in the industry. He called attempts to blame Sarawak for the move 'disingenuous and politically motivated'. 'Sarawak's decision to empower Petros has already opened up new opportunities in investment, job creation, and economic development. 'If certain critics from across the South China Sea truly cared about the people's welfare, they would support and not sabotage Sarawak's progress,' he said. federalism lead Sarawak autonomy Wilfred Yap
The Star
3 hours ago
- The Star
‘We have to build an energy superstore'
PETROLIAM Nasional Bhd (PETRONAS) has swiftly denied talk that its upstream arm in Canada will be sold, emphasising the importance of such an asset as the group navigates its journey as PETRONAS 2.0. PETRONAS Energy Canada Ltd (PECL) is the operator and majority stakeholder (72%) in the North Montney Joint Venture (NMJV) project, one of Canada's largest shale gas plays – or what an industry expert describes as 'crown jewel'. The 800,000-acre NMJV in British Columbia sits atop a massive 53 trillion cubic feet (Tcf) of natural gas reserves and contingent resources. That's more than 1.6 times Malaysia's entire proven gas reserves, which stood at 32 Tcf in 2023, according to the US Energy Information Administration – though reserves have been shrinking. Its direct link to the US$40bil LNG Canada project, in which PETRONAS holds a 25% stake, makes NMJV even more valuable. A 40-year export licence will allow the Kitimat facility to export its first cargo within 'weeks'. PETRONAS CEO speaks PETRONAS president Tan Sri Tengku Muhammad Taufik Tengku Aziz announced on Thursday that the company is undergoing a major transformation to become a more agile and commercially driven energy company, addressing challenges such as cost pressures, structural changes in global energy demand and geopolitical tensions. 'We are looking at a 10-year defining period for PETRONAS,' he says. The internal restructuring, dubbed PETRONAS 2.0, aims to ensure the national oil company remains relevant in the long term. 'We need to operate differently and accept some harsh truths around productivity, our bloated structure and the lack of agility,' he adds. While reaffirming the group's commitment to upstream and liquefied natural gas (LNG), Tengku Muhammad Taufik stresses that PETRONAS must become a fully integrated energy company. 'There is no longer just a need for molecules from hydrocarbons, but also for electrons. We are committed to delivering safe, reliable and sustainable solutions.' Portfolio recalibration Tengku Muhammad Taufik says portfolio 'correction' will be a constant feature as the group seeks to balance risk, return and capital outlay. On Canada, he clarifies that PETRONAS is not exiting the market. 'We are constantly entertaining overtures and proposals. That is going to be the natural course of business and it is a very, very resource-endowed geography. It is clearly positioned,' he notes. 'We see it as crucial to our ambitions to preserve our position in market share in the LNG space.' He adds that the group's central hypothesis is 'we want to build a gas position there'. 'If we are talking of proposals to take the position or take part of that, we will evaluate it. 'But exiting is not on our mind,' he confirms. In March, PETRONAS sold its 50% stake in the La Amarga Chica shale oil block to Vista Energy for around US$1.5bil. Tengku Muhammad Taufik says the decision was driven by mounting costs and tightening margins across the oil and gas sector. 'It is increasingly risky and ridiculously cost-intensive to be in oil and gas. When the fields were easier, our profit before tax margin was 35% to 40%. 'Today it's 25% to 30%. These margins are just going to keep shrinking. The fields are going to get smaller and smaller. 'So, PETRONAS 2.0 has to change this to an organisation that monetises molecules commercially and competitively. We will still have a very competitive upstream. 'This will still mean we want to preserve our leadership position in LNG. But over and above that, we have to build an energy superstore.' Yet, Tengku Muhammad Taufik acknowledges that the energy giant company is simply 'not agile enough'. 'Over the long run, not only asset correction or business portfolio optimisation is going to be required, we've got to take a look at the workforce,' he says. This means 10% – or more than 5,000 – employees will be laid off. 'We've got to start deleting positions because the work we carry out will no longer be relevant or value-adding as we move to PETRONAS 2.0,' he notes. Returning PETRONAS scholars will still have a job upon completing their studies. Even if oil prices were at US$100 per barrel today, he says the company must change. It is estimated that for every dollar drop in the price of Brent crude oil, PETRONAS' profit will fall by about RM1bil. Brent crude oil was US$63.68 per barrel at the time of writing. The company has a RM32bil dividend target for financial year 2025 to the federal government based on an assumed oil price range of US$75 to US$80. PETRONAS feels it can still afford this although it's a large chunk of profit. Should crude oil hover around US$50 to US$60 a barrel, many players will fall off – especially those in shale and deepwater – as they struggle to break even. And as competition for market share intensifies and prices head south, global growth forecasts may need to be revised downwards – particularly if the trade war drags on. To adapt, PETRONAS is prioritising 'advantaged barrels' – low-cost, low-carbon, fast-monetising resources – as the foundation of its upstream strategy. In this, the importance of a responsive domestic oil and gas services and equipment (OGSE) ecosystem is not to be understated. Just to maintain what PETRONAS produces, it will invest RM15bil to RM20bil per year. Including other production sharing contractor, total upstream spending could reach RM60bil to RM70bil annually. The OGSE players will also need to adapt to oil companies which will seek out the best bang for the buck. Tengku Muhammad Taufik says the joint declaration (JD) signed a couple of weeks ago between the federal government and Sarawak marks an encouraging step, spelling out how federal and state laws will co-exist under a proposed framework. 'The JD reflects that there is an acknowledgement by both state and federal that PETRONAS upholds its role under Petroleum Development Act 1974 (PDA 1974),' he says, adding that it also recognises PETRONAS' existing obligations in the LNG space – including upstream operations and third-party sales and purchase agreements. 'It acknowledges that PETRONAS has been accorded the right under PDA 1974 to carry out activities in the full chain of oil and gas undertakings,' he notes. 'And while there is now mention of Petros as an aggregator – not the sole aggregator – we will work together to support the aspirations of the state.' Specifically, the JD outlines a target to deliver 1.2 billion cubic ft per day to the state and positions Sarawak as a potential energy hub for Asean. 'There is also language that prescribes that Petros and PETRONAS shall collaborate in these undertakings,' Tengku Muhammad Taufik adds. The state has also agreed to exempt PETRONAS and its subsidiaries from licensing requirements. However, he points out that the next step is translating the JD principles into a workable framework. He emphasises that PETRONAS will continue to promote Sarawak as a key investment destination. 'We will not shirk from this. In fact, if anything, we'll be drawing in more players.' Tengku Muhammad Taufik also underlines the importance of preserving the LNG value chain, citing the location advantage of Bintulu and PETRONAS' long-standing record as a trusted supplier. 'It takes only about a week to ship to some of our core markets from Bintulu,' he says. 'We've served some customers since 1983... helped them through blackouts, through Fukushima, through energy crises, through Covid-19.' He cautions that PETRONAS' reputation – decades in the making – must not be put at risk. 'While the reputation of a trusted partner takes decades to build, it'll take one bad deal to just unwind.'
The Star
4 hours ago
- The Star
PETRONAS to prioritise employees' welfare
PETRONAS has established a Transition Council and People Development Committees to oversee talent mapping and placement. PETALING JAYA: Petroliam Nasional Bhd (PETRONAS) will roll out a market-competitive separation package to employees affected by the planned 10% workforce reduction under its strategic transformation initiative. The national oil company announced last week that it will be cutting about 5,000 employees as part of its 'right-sizing' exercise in response to an increasingly challenging global operating environment. In a statement, PETRONAS said the transformation is aimed at strengthening its long-term resilience and supporting continued growth through focused investments and the development of a high-performing, value-driven workforce. 'While this is a very difficult decision, it is a necessary one to ensure PETRONAS can continue to grow and serve the nation. 'PETRONAS is committed to managing this process fairly, objectively, and systematically,' the group said. PETRONAS stated that the separation package will include financial compensation exceeding minimum statutory requirements, along with additional support such as career coaching, job placement assistance, medical support, financial planning guidance, as well as upskilling and reskilling opportunities. The packages and benefits offered will vary based on employees' years of service, job category, and eligibility. It is also working with the Social Security Organisation via the MyFutureJobs platform and engaging with government-linked companies to facilitate job placement opportunities for affected staff. Additionally, PETRONAS said it will also offer a structured route into business ownership for those exploring alternative career paths via its Entrepreneurship Programme run. To manage the transition, PETRONAS has established a Transition Council and People Development Committees to oversee talent mapping and placement. The company said the process will follow structured governance and comply with relevant legal and industrial relations practices. Engagements have also been conducted with respective Department of Labour and Department of Industrial Relations under the Human Resources Ministry to ensure the planned implementation meets the statutory requirements. 'Every decision is made with fairness, respect and professionalism. PETRONAS remains deeply committed to the welfare of its people and will ensure that those impacted are treated with compassion and respect,' it said.
