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| Sabah STAR's chairman, Dr Jeffrey Kitingan |
“The Sabah government should take this golden opportunity to demand and sign a new and better oil agreement with Petronas and the federal government” said Datuk Dr. Jeffrey Kitingan, Chairman of STAR Sabah in response to the statement given by the Chief Minister that the State’s 5% petroleum royalty review issue is open for amicable discussions with the federal government.
“If the Chief Minister is truly a Sabahan at heart, this is the most opportune time to not only seek a review but to demand and negotiate a new deal for Sabah’s oil and gas resources for the benefit of Sabah and its future. It cannot be denied that any increase in the oil revenue including the offer of 20% by Pakatan Rakyat is definitely for the benefit of Sabah and Sabahans” added Dr. Jeffrey.
Theold oil agreement is nearly 4 decades old and a new oil deal is certainly needed for the future of Sabah. The so-called review will also test the sincerity of the federal government and the Sabah leaders as well as the extent of the federal-state relationship.
The battle for Putrajayato be decided in Sabah and Sarawak
In addition, it is important to realize that the seat of government in Putrajaya is now likely to be decided by Sabah and Sarawak. Therefore, the Sabah and Sarawak leaders must leverage on their role as kingmakers.
Sabah and Sarawak leaders must ensure that the rights and interests of Sabah and Sarawak come first. And, if the federal government does not agree to increase the share of oil revenue for Sabah and Sarawak, theSabah and Sarawak leaders, as kingmakers, should just change the federal government.
The State government should also adopt a holistic approach to the old oil agreement in seeking a new deal.
Oil Agreement Unconstitutional?
Many are of the opinion that the existing oil agreement is unconstitutional and invalidbecause it is not only unfair but infringes on a fundamental state rights. They also question the authority and the manner of the then Chief Minister in signing away the oil rights without approval from the State Legislative Assembly. The terms of the agreement are not only loop-sided but grossly unfair to the oil-producing states.
5% Not Oil Royalties
The Chief Minister also need to better understand the existing oil agreement.
Firstly, the current 5% is a cash payment payable by Petronas under Section 4 of the Petroleum Development Act, 1974 in return for the ownership and the rights, powers, liberties and privileges of the oil and gas resources vested to Petronas by the State and is not royalty at all. Furthermore, Section 4 provides that the cash payment is to be agreed between the parties, and not imposed upon.
There was unlikely to have been any negotiations in 1976 for the amount of the cash payment. If it had been properly negotiated, it would not have ended up at a mere 5% for transfer of ownership of the oil and gas resources to Petronas. In fact, the then Chief Minster had recently stated that the State was forced to accept the 5% cash payment.
Secondly, very few people know that in fact under Clause 4 of the 1976 agreement that was signed 8 days after the Double Six Tragedy, the State government was also asked to agree to waive or to reject Sabah’s rights to royalties on the oil and gas resources.
Therefore, in the new deal, the Chief Minister should seek the restoration of Sabah’s rights to impose oil royalties which are provided under the State List of the Federal Constitution and Section 24 of the Land Ordinance, Sabah Cap. 68.
How Much Potential Oil Royalties Did Sabah Lose?
Thirdly, as explained, the current 5% oil revenue receivable by the State is cash payment under Section 4 of the Petroleum Development Act and nothing to do with royalties.
In a video recording done in 1975, TengkuRazaleighHamzah, who was then Minister of Finance and President of Petronas explained that royalties entitlements of the states was 12% for up to 3 miles from the shoreline, and with the federal government getting 10% for up to 10 miles and 8% to the federal government for up to the international boundary.
Assuming that this was implemented, Sabah would have gotten or received a total of at least 17% in oil revenue with 12% in royalties and 5% cash payment.
It is STAR’s view that Sabah should receive at least 30% in royalties because Sabah’s boundary is the same as the international boundary as Sabah gained independence on 31 August 1963 thereby establishing its international boundary as a nation. This means Malaysia’s international boundary coincide with Sabab’s international boundary.
STAR’s Views
As part of STAR Sabah’s causes and aspirations for Sabah, STAR is seeking an increase of the oil revenue to 50% nett revenue excluding royalties which are payable even if the ownership is transferred to Petronas. It is set out in STAR’s Petroleum Masterplan which is comprehensive and covers a wide range of policies for Sabah’s oil and gas beneficial to Sabah and Sabahans.
It is also STAR’s view that Sabah’s or Sarawak’s oil rights CANNOT be transferred as it belongs to the States but can only be leased or assigned for a specific period.
An increase from 5% to 50% will bring in an additional amount of at least about RM7.0 billion a year for Sabah. It will definitely help Sabahans and alleviate if not eliminate poverty totally in Sabah.
The additional RM7.0 billion will be proof that the federal and state governments are sincere in resolving the oil issue and talk of asking for a review is not just mere election gimmick to hoodwink the voters in Sabah in the coming general elections.
Sabah BN should touch their heart and impose their political will and secure a new oil deal for the future and benefit of Sabahans and not pay mere lip service and play the issue up as an election gimmick . And if the federal government and Petronasdoes not agree to a new deal for Sabah and Sarawak, the Sabah and Sarawak should stand united and change the federal government for the sake of Sabahans and Sarawakians alike.
“If the Chief Minister is truly a Sabahan at heart, this is the most opportune time to not only seek a review but to demand and negotiate a new deal for Sabah’s oil and gas resources for the benefit of Sabah and its future. It cannot be denied that any increase in the oil revenue including the offer of 20% by Pakatan Rakyat is definitely for the benefit of Sabah and Sabahans” added Dr. Jeffrey.
Theold oil agreement is nearly 4 decades old and a new oil deal is certainly needed for the future of Sabah. The so-called review will also test the sincerity of the federal government and the Sabah leaders as well as the extent of the federal-state relationship.
The battle for Putrajayato be decided in Sabah and Sarawak
In addition, it is important to realize that the seat of government in Putrajaya is now likely to be decided by Sabah and Sarawak. Therefore, the Sabah and Sarawak leaders must leverage on their role as kingmakers.
Sabah and Sarawak leaders must ensure that the rights and interests of Sabah and Sarawak come first. And, if the federal government does not agree to increase the share of oil revenue for Sabah and Sarawak, theSabah and Sarawak leaders, as kingmakers, should just change the federal government.
The State government should also adopt a holistic approach to the old oil agreement in seeking a new deal.
Oil Agreement Unconstitutional?
Many are of the opinion that the existing oil agreement is unconstitutional and invalidbecause it is not only unfair but infringes on a fundamental state rights. They also question the authority and the manner of the then Chief Minister in signing away the oil rights without approval from the State Legislative Assembly. The terms of the agreement are not only loop-sided but grossly unfair to the oil-producing states.
5% Not Oil Royalties
The Chief Minister also need to better understand the existing oil agreement.
Firstly, the current 5% is a cash payment payable by Petronas under Section 4 of the Petroleum Development Act, 1974 in return for the ownership and the rights, powers, liberties and privileges of the oil and gas resources vested to Petronas by the State and is not royalty at all. Furthermore, Section 4 provides that the cash payment is to be agreed between the parties, and not imposed upon.
There was unlikely to have been any negotiations in 1976 for the amount of the cash payment. If it had been properly negotiated, it would not have ended up at a mere 5% for transfer of ownership of the oil and gas resources to Petronas. In fact, the then Chief Minster had recently stated that the State was forced to accept the 5% cash payment.
Secondly, very few people know that in fact under Clause 4 of the 1976 agreement that was signed 8 days after the Double Six Tragedy, the State government was also asked to agree to waive or to reject Sabah’s rights to royalties on the oil and gas resources.
Therefore, in the new deal, the Chief Minister should seek the restoration of Sabah’s rights to impose oil royalties which are provided under the State List of the Federal Constitution and Section 24 of the Land Ordinance, Sabah Cap. 68.
How Much Potential Oil Royalties Did Sabah Lose?
Thirdly, as explained, the current 5% oil revenue receivable by the State is cash payment under Section 4 of the Petroleum Development Act and nothing to do with royalties.
In a video recording done in 1975, TengkuRazaleighHamzah, who was then Minister of Finance and President of Petronas explained that royalties entitlements of the states was 12% for up to 3 miles from the shoreline, and with the federal government getting 10% for up to 10 miles and 8% to the federal government for up to the international boundary.
Assuming that this was implemented, Sabah would have gotten or received a total of at least 17% in oil revenue with 12% in royalties and 5% cash payment.
It is STAR’s view that Sabah should receive at least 30% in royalties because Sabah’s boundary is the same as the international boundary as Sabah gained independence on 31 August 1963 thereby establishing its international boundary as a nation. This means Malaysia’s international boundary coincide with Sabab’s international boundary.
STAR’s Views
As part of STAR Sabah’s causes and aspirations for Sabah, STAR is seeking an increase of the oil revenue to 50% nett revenue excluding royalties which are payable even if the ownership is transferred to Petronas. It is set out in STAR’s Petroleum Masterplan which is comprehensive and covers a wide range of policies for Sabah’s oil and gas beneficial to Sabah and Sabahans.
It is also STAR’s view that Sabah’s or Sarawak’s oil rights CANNOT be transferred as it belongs to the States but can only be leased or assigned for a specific period.
An increase from 5% to 50% will bring in an additional amount of at least about RM7.0 billion a year for Sabah. It will definitely help Sabahans and alleviate if not eliminate poverty totally in Sabah.
The additional RM7.0 billion will be proof that the federal and state governments are sincere in resolving the oil issue and talk of asking for a review is not just mere election gimmick to hoodwink the voters in Sabah in the coming general elections.
Sabah BN should touch their heart and impose their political will and secure a new oil deal for the future and benefit of Sabahans and not pay mere lip service and play the issue up as an election gimmick . And if the federal government and Petronasdoes not agree to a new deal for Sabah and Sarawak, the Sabah and Sarawak should stand united and change the federal government for the sake of Sabahans and Sarawakians alike.
20% ROYALTY OR LEASING ARE NOT A SOLUTION FOR SABAH OR SARAWAK- JUST A CONTINUATION OF MALAYAN CONTROL.
ReplyDeleteWHAT ON EARTH FOR?
WHY NOT JUST TAKE BACK & GET 100% PROFIT FOR OURSELVES? WHY CONTINUE TO BE SO GENEROUS TO DONATE TO MALAYA'S DEVELOPMENT & WE CONTINUED TO BE POOR???
WHAT SORT WHEELERS & DEALERS ARE YOU GUYS ANYWAY- WHY GIVE MORE FOR LESS???
Is that why Malayans look down on us and call us "stupid".?
"Firstly, the current 5% is a cash payment payable by Petronas under Section 4 of the Petroleum Development Act, 1974 in return for the ownership and the rights, powers, liberties and privileges of the oil and gas resources vested to Petronas by the State and is not royalty at all"
(quote Jeffrey)
THIS IS SHOCKING! OUR "LEADERS" GAVE AWAY OUR NATIONAL POSSESSIONS & BILLIONS FOR 5% PITTANCE???
AND THEN WE HAVE TO BEG FOR "DEVELOPMENT FUNDS"!!!
MALAYA NEED US MORE THAN WE NEED THEM.
WE MUST TAKE BACK ALL OUR OIL RIGHTS!
WE DON'T NEED MALAYA OR MALAYSIA & BE COLONISED.
TAKE BACK OUR COUNTRY! TAKE BACK OUR INDEPENDENCE!
INDEPENDENCE
(Comments here are made to commemorate 31 August Malayan Independence Day, Sabah illusory independence Day and Malaysia/Malayanisation Day 16 September.
Ladies & Gentlemen please stand for the Malayan colonial flag at half mast to mourn our loss of independence or upside down to show our distress at being colonised and robbed for 49 years)
Kepentingan rakyat akan didengar. Mengenai Royalti di Sabah ini rasanya kerajaan tahu apa yang akan dilakaukan.
DeleteUPKO has proposed 20% oil royalty so I think the government will take caution on this matter.
DeleteSuara rakyat adalah penentu kerajaan dan sememangnya semua akan menjadi lancar.
DeleteCalling for review of the 5% oil royalty for Sabah is something PBS has been doing since 1985
ReplyDeleteDUMB DEAL
DeleteIt's a joke!
We gave away bundreds of billions over 49 years for 5%-! What sort of deal is that?
Dumb deal! Furthermore the deal was done secretly without the people's approval such as a referendum - so it is illegal! We lost everything.
Scotland, East Timor & Southern Sudan got 100% control of their oil resources.
And Scotland want to follow E Timor & S Sudan to be INDEPENDENT!
There is nothing like being your own master and not owned by a Foreign Master (Malaya)!
100% control of the oil means no more Petronas intervention? All will be managed by Sabahans? I'm curious about this.
DeleteAll I can say is we are hoping for more and better. It's crucial for Sabahans.
Deletethe review on oil royalties for Terengganu and Kelantan by a special committee to be set up by the Federal Government should also include Sabah and Sarawak as both states are the main contributors to the national petroleum production.
ReplyDeleteThis suggestion will be brought into Parliament soon.
DeleteI hope all sabahan and sarawakien more reading about our history, the document,the act and any related to our NATION so we can fight together to bring Sabah and Sarawak out from MALAYA control. This is good oppocunity to us to select MALAYSIA GORVERMENT who become PM in Putrajaya. We only join who party can give what people of sabah and sarawak want. Come on guys ... this time for 'Rock & Roll' ! KALAU BUKAN KITA ? SIAPA LAGI !, KALAU BUKAN SEKARANG ? BILA LAGI ! ... INI KALILAH !!! (sia inda mo itu 'LAIN KALILAH'! ... sabab lama lagi itu 5 tahun lagi mo tunggu OOoo)
ReplyDeleteDont' worry. Musa has assured us the thing so I don't think we should be worried over such thing again.
DeleteThe leaders should look into this crucially and decide for the sake of the people.
ReplyDeletepastikan setiap yang diuat adalah baik untuk rakyat.
DeleteIt is ok if only it will benefit both the people and the government.
ReplyDeletemake sure there will be win-win situation for both side.
Deletesemua pun mengharapkan yang terbaik untuk Sabah dan rakyat.
DeletePM is willing to listen to the voice of the people.
ReplyDeleteMusa has tried so that the oil royalty is open for discussion with the federal government.
ReplyDeletewe support the oil royalty got improvement after the discussion.
DeleteI hope this will work for the development of the state
ReplyDeletesyukur la akhirnya hasrat rakyat Sabah supaya royalti minyak dikaji semula telahpun mendapat perhatian kerajaan persekutuan.. para pemimpin2 pembangkang tidak perlulah sibuk mempertikaikan langkah kerajaan ini..
ReplyDeletePetronas telah membelanjakan 80% daripada hasil petroleum untuk kerja mencarigali dan kos operasi. Anggap sahaja harga minyak mentah dunia pada kadar RM100 setong. Petronas telah mengeluarkan kos RM80 untuk mendapatkan setong minyak dan hanya berbakinya RM20. RM5 telah diserahkan kepada Kerajaan Negeri Sabah sebagai royalti dan RM10 lagi diserahkan kepada Kerajaan Persekutuan untuk menanggung kos subsidi minyak sejumlah RM90 billion setahun; manakala RM5 lagi adalah untung kasar Petronas untuk biasiswa dan sebagainya.
ReplyDeleteOleh itu, jika Petronas menyerahkan RM20 atau 20% kepada Sabah, apakah keuntungan yang diperolehi Petronas, sedangkan Petronas memerlukan dana untuk meneruskan kerja dan kontrak carigali di 46 negara di dunia? Bagaimana Petronas mahu membiayai subsidi minyak yang semakin meningkat?
mungkin kerajaan pimpinan Najib tidak mempunyai masalah untuk menaikkan royalti minyak, namun saya tidak fikir ianya akan setinggi permintaan yang dibuat oleh pemimpin2 pembangkang.. banyak perkara yang perlu dipertimbangkan sebelum membuat keputusan supaya tidak menjejaskan operasi Petronas..
ReplyDeleteSelain royalti, Petronas mungkin boleh menambah pakej menarik untuk Sabah; terutama Projek Gas di Kimanis dalam bentuk ekuiti atau memberi saham kepada setiap rakyat Sabah sebagaimana peranan Yayasan Sabah di era Tun Mustapha; memberi dividen tunai di atas keuntungan balak Yayasan Sabah.
ReplyDeleteJanganlah Petronas terlalu cerewet, tidak tahu berterima kasih dan bangga dengan projek mega mereka kerana rakyat Sabah berhak terhadap setiap titik minyak dan gas asli yang dilombong di negeri ini dan wilayah kedaulatan Sabah.
projek2 petronas di Sabah diharap akan mempercepatkan lagi pembangunan di Sabah.
Deleteprojek ini moga memberi manfaat kepada penduduk Sabah.
Deletekomitmen CM tehadap pekara ini memang diperlukan dan dihargai.
ReplyDeletesemoga keputusan yang terbaik akan diperoleh nanti.
ReplyDeleteSabah and Sarawak should have their own panel to look into the oil royalty review for both states, said United Pasokmomogun KadazanDusun Murut Organization (UPKO) president Tan Sri Bernard Dompok .
ReplyDelete
ReplyDeleteThe Plantation Industries and Commodities Minister said this when asked to comment on the suggestion to have the two East Malaysian states included in the special committee to review the oil royalty paid to Terengganu and Kelantan by the federal government.
“Sabah and Sarawak should have their own panel to talk to the federal government. It is not necessary to be part of the panel for the east coast of Peninsular Malaysia.
ReplyDelete“Obviously the historical setting is quite different both for Sabah and Sarawak and the peninsula states. Therefore I think it is necessary to have a separate panel for these two (East Malaysian) states,” Dompok said.
ReplyDelete
ReplyDeleteWhen asked about the opposition’s claim that the state government had in the past said that there was no necessity to ask for an increase in the royalty because it was getting huge allocation from the federal government for development but is now saying that it is open to discussion, Dompok said, “I do not know about the state government but we (UPKO) have been quite consistent in our view that there should be a re-look into the oil royalty and I think the immediate doable figure to my mind, is 10 per cent.
ReplyDeleteAccording to the Penampang member of parliament, under the agreement with Petronas, the royalty payment is 10 per cent, split between Sabah and Kuala Lumpur.
“I think for a start that one is doable… for a start we can almost have another five per cent. This is my thinking. Beyond that there will have to be some negotiation with the oil companies because there are power sharing contracts with these companies in which these terms are spelt out.
ReplyDelete“Therefore this is an area that needs to be looked into and this is where the committee comes in. That is why I said Sabah and Sarawak deserve a different committee from the one they have in Semenanjung,” Dompok stressed.
ReplyDeleteHe explained that the federal government has already been indirectly paying money to Kelantan and Terengganu.
ReplyDelete“Probably not in royalty but in essence they have been paid some money so I think it would not be wise to lump it up together with Sabah and Sarawak because Sabah and Sarawak are different,” he pointed out.
ReplyDelete