‘DON’T DIP INTO PETRONAS’ COFFERS’

This happened during Dr M’s previous administration, says Najib

DATUK Seri Najib Razak has urged the government to refrain from dipping into Petronas’ coffers for “bailout missions”, like what Prime Minister Tun Dr Mahathir Mohamad did during his previous administration.

Commenting on the decision to compensate the abolishment of the Goods and Services Tax by requesting Petronas, Khazanah Nasional Bhd and Bank Negara Malaysia fork out higher dividends for the government, the former prime minister said such a measure was unsustainable and would work only for a short term.

“Petronas’ revenue depends on world oil and gas prices, which are not under its control. Gross dependency on higher price of oil should be avoided.

“Although the global oil price (per barrel) is higher than the forecast made in the 2018 Budget, which I tabled last year, we need to be prepared should it plunge by 80 per cent, like in 2014 and 2015.

“I plead for the new government to continue providing substantial space and capital for Petronas to fulfil its vision, instead of raiding its coffers for bailout missions, which took place during Dr Mahathir’s 22 years of administration back then.”

Najib said Petronas’ cash reserves had increased to RM164.7 billion at the end of March; an increase of RM36.5 billion compared with the RM128.2 billion that was recorded during the last three months of last year.

He attributed this to an increase in oil prices and Saudi Aramco’s payment for its investment in the Refinery and Petrochemical Integrated Development (RAPID) project in Pengerang, Johor.

“The reserves are much higher compared with 2008, when I first took office as finance minister.

“During my administration, I was scrupulous in ensuring that Petronas would not have to pay dividends more than what was required as I needed to ensure that there were sufficient funds to meet development plans in main and downstream business sectors.”

As a result, he said, Petronas’ funds increased significantly and the company was able to carry out game-changing projects, such as RAPID, the Sabah-Sarawak Integrated Oil and Gas Project and Sabah Ammonia Urea.

“Petronas was given the freedom to invest in local and international upstream projects, such as in Canada, Iraq and Brunei.

...Continue providing substantial space and capital for Petronas to fulfil its vision, instead of raiding into its coffers for bailout missions... DATUK SERI NAJIB RAZAK

Former prime minister

“These investments have the potential to yield high dividends for Petronas and Malaysia in the long term. We invest for returns in the long run.”