PETROLIAM Nasional Bhd (Petronas) and the Sarawak state government has signed a new deal pertaining to the management of oil and gas resources in the East Malaysian state.
“This new agreement will open a new chapter in our effort to boost development of Sarawak’s oil and gas industry, creating new business opportunities to all,” said Prime Minister Tan Sri Muhyiddin Yassin, in a statement.
The new agreement may see an end to a long-standing dispute between both parties on the management of oil and gas in Sarawak.
In January last year, the Sarawak state government imposed a 5% sales tax on Petronas’ petroleum products, under the state’s Sales Tax Ordinance 1998.
However, the national oil company refused to pay the tax saying the move was unconstitutional.
Subsequently, the state government took the matter to court, with the High Court ruling in favour of Sarawak.
Earlier this year, Petronas agreed to pay some RM2 bil in sales tax owed to Sarawak, after reaching a settlement.
Muhyiddin said the new agreement would allow Petroleum Sarawak Bhd (Petros), a subsidiary of the Sarawak state government, to play a bigger role in the state’s oil and gas industry, through cooperation with Petronas.
“It will also open up more business opportunities to oil and gas related companies in Sarawak,” said the Pagoh MP.
However, Muhyiddin reiterated that Petronas will continue being the national petroleum company, with full powers to regulate the development of the overall oil and gas industry in the country.
In a joint statement, Petronas and the Sarawak state government said the new deal would allow Sarawak to have a greater share of revenues from oil and gas found and produced in the state.
“It will also allow Sarawak to manage its oil and gas industry through the management of onshore oil and gas resources by Petros and investments, in the upstream ventures in offshore areas.
“The agreement provides for a consultative framework whereby both parties will be able to discuss and deliberate on matters of importance to the oil and gas industry affecting the state,” they said.
The joint statement was signed by Sarawak state secretary Datuk Jaul Samion and Petronas president cum group chief executive officer Tengku Muhammad Taufik Tengku Aziz. – Dec 7, 2020.
