20% royalty will harm O&G industry


Dateline 2014-08-07, Borneo Post Online:

An increase in cash payments, which some people prefer to call royalty, by Petronas to the state and federal governments would have an adverse impact on the project viability and the industry at large, according to the vice president of Malaysia Petroleum Management, Adif Zulkifli.

He said that if the cash payments were to be increased to 20 per cent for Sabah, some projects undertaken by Petronas may be in jeopardy.

The immediate impact would be projects being dropped by foreign investors, investors’ confidence will be eroded and the country’s energy security will be at risk, he said.

Adif said the mid-term impact would be contract and opportunity losses for supporting industry, no further exploration activities and retrenchment.

 

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