Sabah to set up panel to oversee oil royalty matters

KOTA KINABALU: Sabah will set up a committee to oversee matters relating to the 20% oil royalty, saying that a proposal from the Federal Government for this to be based on net profit has yet to be finalised.

Datuk Seri Mohd Shafie Apdal, who heads the Parti Warisan Sabah-led government, said according to the Malaysia Agreement 1963 (MA63) and in the federation, Sabah is supposed to receive 20% royalty and not from net profit.

The party, he said, had at the outset also expressed its support for Pakatan Harapan due to its election manifesto, which included giving back Sabah its rights accord- ing to MA63 and the 20% oil royalty.

Sabah currently gets 5% oil royalty.

“So, what we ask is for the Government to add 15% to make it 20%,” said the Chief Minister, adding that the move would become a reality.

Shafie said the committee would, among others, fine-tune discussions with the Federal Government, specifically with Prime Minister Tun Dr Mahathir Mohamad.

“We know that oil royalty is among Pakatan’s manifesto and we will continue to talk to the top leaders on its implementation,” he said after an event in Semporna yesterday.

He noted that what was important at the moment was continuous funding and allocation through dividends of oil production for producing states including Sabah.

He added that although Dr Mahathir had mentioned giving 20% from profits of fuel production to Sabah, the matter had yet to be finalised.

Last Wednesday, Economic Affairs Minister Datuk Seri Azmin Ali told Parliament that the 20% oil royalty payment promised by Pakatan in its election manifesto could not be made immediately as the provisions of the Petroleum Development Act 1974 needed to be amended first.

Azmin said royalties paid to oil-producing states would be based on net profit and not gross value since the latter would have serious financial implications for Petronas and the Federal Government.

In Kuching, Bernama reported that Sarawak Pakatan will announce the proposed “New Deal Agreement” that will be brought to the special Cabinet committee to oversee the enforcement of MA63.

Its chairman Chong Chieng Jen said all Sarawak Pakatan MPs, including PKR chairman Baru Bian (MP for Selangau), will be present during the announcement set to be made on the sidelines of the Parliament sitting today.

“The special Cabinet committee that will be formed in due course will look into other means of fair and equitable sharing of oil wealth by the state.

“The deal that will be offered by the Pakatan Federal Government in respect to this oil wealth-sharing arrangement will be better than what the Barisan Nasional has offered Sarawak for the past 45 years,” he told a press conference yesterday.