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Free Malaysia Today
4 days ago
- Business
- Free Malaysia Today
Petroleum Development Act can't supersede relevant Sarawak laws, says senator
Senator Ahmad Ibrahim disputed law and institutional reform minister Azalina Othman Said's statement that Petronas's rights on O&G resources in Sarawak remain protected under the PDA. (Petronas pic) PETALING JAYA : The Petroleum Development Act (PDA) 1974 cannot supersede the relevant laws in Sarawak, especially the Oil Mining Ordinance (OMO) 1958, a senator said in disputing a statement by a federal minister. Ahmad Ibrahim said Sarawak had been producing oil and gas since the discovery of oil in Miri in 1910, some 53 years before Malaysia was formed, the Sarawak Public Communications Unit reported. Ahmad said Sarawak had developed the industry under the state's own laws way before the PDA was enacted. Apart from the PDA, he said, the other relevant laws were the Distribution of Gas Ordinance (DGO) 2016, the Sarawak Land Code, and the State Sales Tax regime. He said Section 73 of the Malaysia Act 1963 preserved all state laws in force before Malaysia was formed, which included the OMO. Moreover, the ordinance, following its amendment in 2018, granted the state full authority over petroleum licensing onshore and on its continental shelf. 'The PDA (only) applies fully in states that do not have their own petroleum laws like the OMO, and therefore, in those states, Petronas is the sole aggregator of oil and gas,' he was quoted as saying. On Tuesday, law and institutional reform minister Azalina Othman Said said the national oil company's rights on oil and gas resources in Sarawak remained protected under the PDA. In a written parliamentary reply, Azalina said the PDA would remain in force, in accordance with existing legal provisions. 'Petronas is vested with the ownership of petroleum, and the rights, powers, freedoms, and exclusive privileges to explore, exploit, obtain, and acquire petroleum, whether onshore or offshore Malaysia, as provided for under the Act,' she was quoted as saying. Ahmad said that under the DGO, Sarawak has exclusive authority to license and regulate domestic gas distribution, with state-owned Petroleum Sarawak Bhd (Petros) having been formally recognised by the federal government as the sole gas aggregator for Sarawak's domestic market, excluding liquefied natural gas. As for the State Sales Tax, he said, a 2020 High Court ruling upheld Sarawak's right to impose such a tax on petroleum products, noting that Petronas withdrew its appeal and settled the dues. On Feb 5, Azalina said Sarawak had accepted that the PDA, not the state ordinances, dictated the operation of Malaysia's petroleum sector. She said Sarawak's concession was among key matters agreed upon by Prime Minister Anwar Ibrahim and Sarawak premier Abang Johari Openg during a meeting on Jan 7. On Feb 7, Anwar said the federal and Sarawak governments had agreed to Petronas and its subsidiaries retaining all existing contractual obligations, domestic and international. However, to fulfil Sarawak's aspirations in the oil and gas sector, it was agreed that the DGO will come into force on March 1, he said. 'The DGO will be read together with the PDA, and therefore Petros will act as Sarawak's aggregator,' he had said. Anwar said this after Abang Johari reiterated the state's contention that it had regulatory authority over oil and gas activities within its territory.
Borneo Post
04-05-2025
- Business
- Borneo Post
Respect Sarawak's laws on oil and gas, PBB Youth urges Armada
A view of the DUN Sarawak Complex. — Photo by Roystein Emmor KUCHING (May 4): Parti Pesaka Bumiputera Bersatu (PBB) Youth wing has expressed disappointment with Parti Pribumi Bersatu Malaysia (Bersatu)'s Youth wing (Armada) over its series of statements, which appear to undermine Sarawak's rights, ownership and claims over the state's oil and gas resources. In a statement, PBB Youth said Armada was incorrect in citing the Petroleum Development Act (PDA) 1974 as the sole major law granting Petronas absolute authority over the management and distribution of oil and gas in Sarawak. PBB Youth explained that Sarawak has never repealed the Oil Mining Ordinance (OMO) 1958, a state law that remains in force to this day to regulate the oil and gas sector. 'We urge all parties, including Armada to be more sensitive and refer to the Sarawak's state laws before making any statements regarding oil and gas and the Sarawak government's claims. 'Do not assume that Sarawak state laws do not exist, as this makes it seem as though our state laws are being trampled on. 'We also urge that Sarawak state laws be respect by all parties, just as some have called for Sarawak to respect federal laws,' said PBB Youth. PBB Youth reiterated that any party wishing to operate in Sarawak must comply with state laws, including the OMO and the Distribution of Gas Ordinance (DGO) 2016. It further explained that, under the Ninth Schedule of the Federal Constitution, the power to issue mining licences and certificates falls under the jurisdiction of the state government through Article 2(c) in the State List (List II). 'In other words, any mining activity must obtain approval from the Sarawak government,' it added. PBB Youth also expressed hope that both Petroleum Sarawak Berhad (Petros) and Petroliam Nasional Berhad (Petronas) will continue to cooperate based on the existing federal and state regulations and laws for the development of the oil and gas sector in Sarawak. It was reported on May 2 that Sarawak has issued a legal notice to Petronas Carigali Sdn Bhd, as the company is allegedly operating without a permit at its Miri Crude Oil Terminal (MCOT). In response, Armada released a statement on May 3 dismissing the Sarawak government's claim that Petronas Carigali is operating illegally at MCOT, calling the accusation as baseless and inconsistent with existing laws. Armada argued that the PDA 1974 clearly grants Petronas exclusive rights to regulate all petroleum-related activities across Malaysia and that Petronas does not require a licence or permit from the Sarawak government to conduct its petroleum operations in the state. Armada lead oil and gas PBB Youth rights
Borneo Post
02-05-2025
- Business
- Borneo Post
Lo: ConocoPhillips exit provides chance for Sarawak to reclaim greater control over oil and gas future
File photo for illustration purposes 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
