UBF: Petroleum Fund Better than Nothing But Not the Right Solution

Sabah only get 5% share of its oil production
while peninsula getting the most

By Edward Linggu

TAMPARULI: The proposed Petroleum Fund for Sabah suggested by Pakatan Rakyat is not the only right solution for Sabah.

Obviously, the Petroleum Fund is better than nothing under the BN Government, there are better ways to ensure the Government and people of Sabah benefit from its oil resources.

Although there have been reports of new oil and gas finds off the coast of Sabah including its inner waters and the inking of the RM37 billion joint venture by Petronas a few days ago, it has to be remembered that Sabah’s oil and gas resources are a depleting resource.

The things being done by the Federal Government and Petronas on Sabah’s oil and gas resources are not acceptable.

There is no justification whatsoever for Kimans gas to be piped via a new RM3.5 billion pipeline to Bintulu! In the end, Bintulu and Sarawak enjoys the spin-offs of the processing of Sabah’s gas and Sabah enjoys nothing at all except the view of the unsightly pipeline running from Kimanis to Sipitang and the blockage and trouble created by the pipeline to the locals.

In the Sabah 2012 State Budget, the Chief Minister has projected that in 2012 Petronas will receive some RM14.734 billion while Sabah’s 5% portion only amount to RM0.775 billion. Even then, the RM775 million will be completely spent in the 2012 Budget leaving nothing for the future generations in Sabah.

Under the Federal Government and Petronas, Sabah will be destined to continue as the poorest in Malaysia where now for every 10 poor Malaysians, 4 are in Sabah. The 6 poor are spread over the other 12 States.

What happens then when Sabah’s oil and gas resources are depleted?

Let’s compare to the situation in other countries. In Indonesia, it is a republic, a unitary state. Yet, Acheh Province is administered autonomously and gets 70% of the oil revenue from Acheh’s oil and gas resources.

In Malaysia, Sabah gets 5%. Is is fair? Is it equitable?

Petronas Twin Towers, built using Sabah's money

In the Russian republic, the Muslim republics like Khazakstan and Turkmenistan manage their own oil and gas resources. They even choose who to explore and exploit their oil and gas resources and sign agreements on their own, it is not decided and not signed by Russia.

In Malaysia, Sabah’s oil and gas resources is owned and managed by Petronas which is answerable to the Prime Miinister, not even reportable to Parliament. Decisions are made by Petronas and agreements signed by Petronas and as seen few days ago, witnessed by the Prime Minister. Except for some VIPs, ordinary Sabahans are kept in the dark and remain at best on-lookers from afar.

In Norway, its petroleum resources in the North Sea are tapped and the revenue generated are utilized for Norwegians, those living and those yet unborn. From a zero starting point in 1990, the “The Petroleum Fund Norway” is now the richest sovereign wealth fund in the world, even larger than Abu Dhabi Investment Authority, and now stands at some USD600 billion (Norwegian Kroner NOK 3,200 billion) in assets. The Petroleum Fund Norway is managed by Norges Bank Investment Management (NBIM), and subject to ethical guidelines laid down by the Petroleum Fund’s Advisory Council on Ethics.

In Sabah, the oil royalties received each year are fully spent leaving nothing in investments for the future generations.

On the proposed Petroleum Fund, while only sketchy details are provided, it appears that the Petroleum Fund will be from Sabah’s oil and gas resources but it will remain to be decided and managed by Federal Pakatan leaders.

In 1963, Sabahans may not be ready. Now, in 2012, Sabahans are more than ready and capable of managing Sabah and its own resources.

We cannot rely on and cannot depend on outsiders to decide on the interests of Sabah.

The time has come for the people and leaders in Sabah and Sarawak to stand united and “TAKE CHARGE” and not rely on others to safeguard Sabah and Sarawak’s rights and to protect Sabah for the benefit of Sabah and Sabahans and their future generations!

“KALAU BUKAN KITA, SIAPA LAGI? KALAU BUKAN SEKARANG, BILA LAGI?

“UNITY IS DUTY”