Associations engage Petronas to safeguard industry’s future

June 12, 2020

And the didn’t invite MOGEC. Where art thou?

Dateline 2020-05-21, NST:

Three associations representing the interests of the Malaysian oil and gas industry recently revealed they had engaged with Petronas to mitigate and address the current dire situation and circumstances affecting the industry.

Brought about by an unprecedented downturn due to the geopolitics of big oil producing countries, which has been amplified by the threat and spread of the Covid-19 pandemic, the associations — The Malaysian Oil & Gas Services Council (MOGSC), Malaysia Offshore Support Vessels (OSV) Owners’ Association (MOSVA), and the Malaysian Offshore Contractors Association (MOCA) — had a video conference meeting with the top leadership of Petronas last month.

During the meeting, the three associations representing over 500 companies and a workforce of 60,000, shared with Petronas the state of the industry and the challenges the companies were facing.

CM: Sabah will continue to pursue 20pc from Petronas

June 9, 2020

Dateline 2020-05-14, Malay Mail:

Petronas’ new agreement with Sarawak does not have any bearing on Sabah, who just imposed a 5 per cent sales tax on petroleum products beginning last month.

Sabah Chief Minister Datuk Seri Shafie Apdal said that the state was sticking to its 5 per cent sales tax while it continued to pursue a 20 per cent oil royalty deal with the federal government that it has been eyeing for decades.

“That’s their negotiations with Petronas. We’ve already imposed the sales tax. We have an understanding with them and other petroleum companies,” said Shafie when asked to comment on Sarawak’s new agreement with Petronas and the federal government.

Rastam Hadi, ‘visionary’ first MD of Petronas, dies

May 24, 2020

Dateline 2020-05-09, FMT:

Rastam Hadi, the first employee of Petronas and also its first managing director, died today two weeks short of his 89th birthday.

He was described as a visionary and a nationalist.

His daughter, lawyer and composer Saidah Rastam, said he died at 3.20am at her home in Bukit Tunku, Kuala Lumpur. He was buried at Bukit Kiara cemetery this afternoon.

Rastam was managing director of the national oil and gas company from 1974 to 1987, and also served as the company’s senior vice-president (upstream sector) from 1987 to 1989.

Malaysia’s Petronas drops legal action against Sarawak, to pay $462 million sales tax

May 23, 2020

Dateline 2020-05-08, Reuters:

Malaysian national oil firm Petronas has agreed to withdraw legal proceedings against Sarawak state and make full payment of a sales tax imposed by the state government on petroleum products for 2019 of 2 billion ringgit ($462 million), at 5% of the value of products, Petronas said in a statement on Friday.

Petronas agreed to withdraw an appeal of the Sarawak High Court’s decision on the application for a judicial review in March, while Sarawak will also drop all civil litigation against Petronas for payment of sales tax on petroleum products, the statement added.

Oil royalties for Sabah and Sarawak: Dead on arrival

May 21, 2020

Dateline 2020-04-25, FMT:

Brent crude oil prices dipping below US$30 and US oil prices turning negative for the first time in history is bad news for Sabah and Sarawak, which are dependent on oil royalties as a major source of revenue.

Analysts predict the depressed oil price will continue in the short and middle term as demand continues to fall. Oil producers like Petronas facing a glut market are riding in uncharted deep waters as Covid-19 batters the world oil markets.

For Sabah, petroleum royalty remains the highest contributor to the state coffers. For 2020, the total projected revenue from oil is RM1.7 billion. Oil royalty accounts for 40.55% of the state revenue. This estimate is based on royalty payment received from Petronas in 2019 amounting to RM1,703.5 million, the highest amount received since the Petroleum Development Act 1974 was passed.

China And Malaysia Clash In Highly Disputed South China Sea

May 18, 2020

Dateline 2020-04-17, Oil Price:

Tensions are rising in the disputed South China Sea, where a Chinese survey vessel has been tagging an exploration ship which Malaysia’s state oil firm Petronas is operating in the area, security sources in the region told Reuters on Friday.

The long-running dispute in the South China Sea involves territorial claims by China as well as Vietnam, the Philippines, Taiwan, Brunei, and Malaysia. China has territorial claims to about 90 percent of the South China Sea, which has put it at odds with its neighbors.

The Chinese research and survey vessel Haiyang Dizhi 8 was close to Malaysian waters, and at one point on Friday, the Chinese ship was flanked by Chinese ships of the coast guard and maritime militia, according to Reuters’ sources. The Haiyang Dizhi 8 ship was close to the West Capella exploration vessel operated by Petronas.

Malaysia’s Petronas warns of project delays, aims to keep local capex

May 15, 2020

Dateline 2020-04-14, Yahoo:

Malaysian state energy giant Petronas said the risks of delays to some of its projects were rising due to prolonged coronavirus-related lockdowns around the world.

Petronas, which operates in more than 20 countries including Brazil and the United States, said in an email that it would try to maintain its domestic spending for this year.

The company forecast 2020 domestic capital expenditure of 26 billion ringgit ($6 billion) to 28 billion ringgit, higher than last year.

“The ongoing global spread of the COVID-19 outbreak and collapse in oil prices continue to impact financial markets as well as many economies and industries around the world,” Petronas said in an emailed statement on Monday.

Petronas mulling appeal on right to sales tax

May 9, 2020

Lawyer are essential services.

Dateline 2020-03-18, FMT:

Petronas is still considering whether to appeal against last week’s High Court ruling that Sabah and Sarawak have the right under the Federal Constitution to impose sales tax on petroleum products.

“We have 30 days from March 13 to file a notice of appeal to the Court of Appeal,” said lawyer Malik Imtiaz Sarwar who represents the national oil and gas company.

Last week, judge Azahari Kamal Ramli, who is based in Kuching, dismissed Petronas’ judicial review application to declare the Sarawak state sales tax null and void.

Petronas had claimed that some parts of the state’s Sales Tax Ordinance 1998, which require the national oil company to pay the 5% sales tax on petroleum products to Sarawak, were unconstitutional.

Petronas takes workplace action amid Covid-19 pandemic

May 4, 2020

Out of date, but hey.

Dateline 2020-03-16, Upstream Online:

Malaysia’s national oil company Petronas has put in place special working arrangements for its thousands of employees as a precautionary measure to minimise the risk of the deadly Covid-19 virus.

With immediate effect, Petronas is “strongly encouraging” employees who can work from home, to do so where possible. No timeframe was given for this measure.

“For employees who are required to be physically present in the office or at our operations, Petronas is taking the necessary steps to ensure their health and safety while at the workplace,” the company said on Sunday without giving details.

High Court rules Sabah, Sarawak can impose sales tax on petroleum products

April 30, 2020

Dateline 2020-03-13, FMT:

The High Court today ruled that Sabah and Sarawak have the right under the Federal Constitution to impose sales tax on petroleum products.

High Court Judge Azahari Kamal Ramli dismissed the leave application for judicial review by Petronas to declare the Sarawak state sales tax null and void.

Petronas had claimed that some parts of the state’s Sales Tax Ordinance 1998, which require the national oil company to pay the 5% sales tax on petroleum products to Sarawak, were unconstitutional.

The company’s lawyer Malik Imtiaz Sarwar argued that the notice of assessment issued by the Sarawak government to Petronas seeking payment of the tax on petroleum products was therefore invalid.