Testing time for Petronas


Dateline 2018-06-30, NST:

THE Sarawak government is expected to enforce the Oil and Mining Ordinance 1958 (OMO 1958) tomorrow after Petroliam Nasional Bhd (Petronas) was denied leave to commence legal proceedings to seek a declaration on the Petroleum Development Act 1974 (PDA) being the law applicable for the petroleum industry in Malaysia.

Petronas is seeking a declaration that it is the exclusive owner of the petroleum resources and the sole regulator for the upstream industry in Malaysia while the state government is seeking to regulate the oil and gas (O&G) industry based on its laws — OMO 1958, the Land Code of Sarawak and the Gas Distribution Ordinance 2016.

The national oil company believes that the determination by the Federal Court would help provide clarity on its rights and position under the PDA.

Legal firm Azmi & Associates partner Zuhaidi Mohd Shahari said Petronas’ authority as the regulatory body in petroleum and gas in Malaysia as provided for under PDA1974 had never been really contested.

“What Petronas did was to seek declaration that the PDA supersedes the Sarawak state laws on mining. Unfortunately, the Federal Court did not grant (permission) for that suit to be heard by the Federal Court.

 

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