The legal deadlock over Sarawak’s oil and gas

September 9, 2018

Dateline 2018-06-24, Malaysiakini:

On Friday, the Federal Court dismissed Petronas’ application for leave to challenge Sarawak’s aspirations to reassert regulatory control over its own oil and gas.

The Federal Court also struck out Petronas’ application for an order preserving the status quo which, at least for now, appears to enable Sarawak to proceed with its intention of implementing its own oil and gas regulatory regime by July 1.

As much as we welcome it, Sarawakians must be cautious in embracing the Federal Court decision.

Petronas’ leave application was dismissed solely on the grounds that the declaratory relief sought did not come within the exclusive original jurisdiction of the Federal Court.

Petronas seeks clarity amid Sarawak’s O&G ambition

August 25, 2018

For the historical books

Dateline 2018-06-19, The Edge:

PETROLIAM Nasional Bhd’s (Petronas) court challenge of Sarawak’s claim of regulatory authority over oil and gas activities in the state has sparked a barrage of political responses and an angry backlash.

There was an outcry over the perceived trampling of state rights over oil and gas wealth in Sarawak. Many also began to question Pakatan Harapan’s pre-election promise to increase oil royalty to 20%.

But court documents viewed by The Edge indicate that the national oil company is pursuing a more precise question: who is in charge of upstream oil and gas activities in Sarawak?
For Petronas, it is a question that needs an urgent answer because operational continuity and investor confidence, which are vital to attract future investments, are at stake.

Is it time to bet on O&G?

August 23, 2018

Please, bet on IGL.

Dateline 2018-06-18, The Edge:

With the stock market, particularly construction counters, roiled by major policy changes under the new Pakatan Harapan administration, the oil and gas (O&G) sector may be ripe for a relook as crude oil prices have been maintained at fairly decent levels.

Pong Teng Siew, the head of research of Inter-Pacific Securities Sdn Bhd, told The Edge Financial Daily there could be selective gems, especially in the O&G space, which could benefit from stronger oil prices as the worst appears to have passed.

Recent financial results pointed to an improvement, and for some even a turnaround in their performance.
Velesto Energy Bhd is one, posting a net profit of RM5 million for the first quarter ended March 31, 2018, compared to a net loss of RM104.1 million in the corresponding quarter a year ago. In the preceeding quarter ended December, its loss was a whopping RM980.5 million.

Time to reverse the flow of oil revenue, says SAS

August 18, 2018

Dateline 2018-06-13, Borneo Post:

Solidariti Anak Sarawak (SAS) founder Peter John Jaban said it is time for Sarawak to consider keeping 95 per cent of oil revenue for the state and give the balance to the federal government.

“It is time to reverse the flow – with Sarawak giving the federal government five per cent of the oil revenue and keeping the remaining 95 per cent for the people of Sarawak,” he said.

Speaking to reporters after a gathering at the Kuching Waterfront yesterday to show support for the Sarawak government, Peter John said that revenue from oil sits at the heart of the autonomy issue which has been the principal driver of policy and feeling in Sarawak over the past few years.

“The question is simple – whether the people of the Borneo states should receive the benefits of the resources that have been part of their territory since long before Malaysia was even conceived.

Listing of Petronas unlikely

August 17, 2018

Dateline 2018-06-13, The Edge:

ONCE again, there is talk of a possible flotation of national oil company Petroliam Nasional Bhd (Petronas). Speculation about such a move makes the rounds every few years. Listing Petronas, it is said, could be one way to help cut down the country’s debt, which has breached the RM1 trillion mark, or a little more than 80% of gross domestic product.

But will it take place?

“It was first mooted some 10 years or so ago by merchant bankers when the government was looking to attract foreigners to invest in Malaysia … it was the same time Synergy Drive (which later morphed into Sime Darby Bhd around 2007) was created. It involved the merger of Kumpulan Guthrie, Golden Hope and Sime Darby. A plantation giant was created but did it achieve what it was supposed to do? Did foreign investors come flocking in?” asks a director of an oil and gas company.\

Laws covering oil and gas industry in Sarawak upstream and downstream

July 24, 2018

Dateline 2018-07-10, Borneo Post:

Constitutional position

Sarawak boundaries

Article 1(3) FC stipulates that territory of Sarawak would be the territory immediately before Malaysia Day and Sarawak’s boundaries shall not be altered except by a law passed by the State Legislature.

State legislative powers to issue permits and licenses for prospecting for mines; mining leases and certificates. Sarawak government and not federal Parliament or the federal government has the executive powers to issue such permits, licenses or leases for petroleum exploration, prospecting or mining.

The PETRONAS-Sarawak oil intrigue

July 23, 2018

Dateline 2018-06-09, The Star:

SIX DAYS after former prime minister Datuk Seri Najib Tun Razak announced the dissolution of Parliament, Petroliam Nasional Bhd (Petronas) received a letter from the Attorney General (AG) of Sarawak, which it knew it had to act on.

The letter effectively aimed to relieve Petronas as the undisputed guardian of oil and gas (O&G) resources in Malaysia and its powers to be shared with the state government-owned Petroleum Sarawak Bhd (Petros).

Officials familiar with the matter say the biggest fear for Petronas was that its role as the authority for any O&G exploration works would be compromised not because of inadequate laws, but the weak political strength of the federal government.