Sarawak minister says state won’t buy Petronas assets

KUCHING, Dec 14 ― The Sarawak government will not consider buying stakes in Petroliam Nasional Berhad’s (Petronas) assets in the state’s territorial waters, Law, State-Relations and Projects Monitoring Assistant Minister Datuk Sharifah Hasidah Sayeed Aman Ghazali said last night.

She said there is nothing to be happy about with the offer mentioned by Prime Minister Tun Dr Mahathir Mohamad that the federal government intended to sell stakes in Petronas to Sarawak and Sabah.

“Oil and gas resources are ours and why should we pay for it, even 1 per cent stake would cost us billions,” she said in a briefing to a group of professionals and businessmen here.

Hasidah also said the state government has rejected zero-rating the State Sales Tax (SST) on the export of petroleum products from Sarawak as proposed by Petronas and the federal government.

She said Petronas had proposed that the state government dropped the imposition of the SST and enforcement of the Oil Mining Ordinance in exchange of a 3 per cent ex gratia payment or equivalent to 3 per cent additional cash payment.

Hasidah said Chief Minister Datuk Patinggi Abang Johari Openg has written to the federal government stating categorically that the state is firm in imposing SST on petroleum products exported from Sarawak as this is its constitutional right.

“We are demanding that SST charged on liquefied natural gas (LNG), crude oil and condensates exported from Sarawak for this year be paid by Petronas within this year,” she said.

However, she said, the state government is prepared to reduce the rate of SST provided Petronas and federal government compensate Sarawak for any shortfall.

Hasidah said Petronas owed RM1.2b in SST to Sarawak as at the end of June this year while Shell and Murphy Oil have settled theirs and Pertamina has registered to pay the tax.

She said it is not right for Petronas to refuse to pay the tax, even after an assessment notice has been issued to them.

“Therefore, we have filed a suit against them on November 21 and any settlement and agreement will be discussed further in court,” Hasidah said.

She said the state contributes hugely to Petronas’ success as shown by the Malaysian Statistic Department that the volume of LNG production exported from Sarawak was 27 million metric tonnes and amounted to a gross amount of RM 41.1 billion for the year 2017.

She said from 1976 to 2017, total revenue amounted to RM660 billion, but only RM33 billion was given to the state so far.

 “The overall amount of crude petroleum exported from Sarawak in 2017 was 3,353,000 metric tons and was worth RM 9.4 billion.

“It was reported by world-renowned Oil and Gas Consultant, Arthur D. Little, for the year 2005-2015, Sarawak contributed 60 per cent to 65 per cent of the country’s gas production and 30 per cent for the country’s oil production,” she said.

Hasidah said based on the December 2017 data from Petronas, there are 41 Production Sharing Contract (PSCs), that is, 41 blocks of PSCs found within the offshore of Miri and Bintulu.

She said the volume of total gas production was 4.1 billion standard cubic feet, or which is equivalent to 680,000 barrels of oil per day and the total of oil production was 173,000 barrels per day for the year 2017.

“From the statistics, it is evident that Sarawak is contributing hugely to the success of Petronas. Therefore, time has come for us to get a little bit of that back to the state,” she added.