Out With The Truth On Sarawak’s Oil & Gas, Chief Minister Rebuked

STATEMENT: I call upon Abang Johari to be truthful to the people of Sarawak and not to equate “regulatory power” in oil and gas industry with “ownership” of oil and gas found in the State.

There is a world of difference between “regulatory power” in oil and gas industry and “ownership” over oil and gas found in Sarawak. The Sarawak BN is just trying to confuse the people with this notion of “regulatory power” to cover up its failure to exert any claim over the “ownership” of oil and gas of Sarawak or obtain the 20% oil and gas royalties.

The announcement made by Abang Jo in relation to Sarawak will have full “regulatory power” over the oil and gas industry is nothing but mere hot air when “ownership” of oil and gas still remains vested in PETRONAS under the Petroleum Development Act 1974.

This is evident when after all the talk of “full regulatory power”, Sarawak will still only get 5% of the oil and gas royalties for the oil and gas extracted from Sarawak, nothing extra.


Even for the so-called “regulatory power”, it only involves another layer of licensing requirement as the Prime Minister and PETRONAS will remain the ultimate decision-maker in the industry, having control over export, import, industrial development and finance.

Moreover, laws and regulations in oil and gas industry ought to conform to international standards which Sarawak cannot unilaterally impose its conditions.

Using the concept of a company as an analogy to our case of the oil and gas industry in Sarawak, the shareholders of the company are the owners of the company, which in our case is PETRONAS by virtue of the Petroleum Development Act, 1974. PETRONAS has the ownership of all the oil and gas found in Sarawak.


The managing director is the overall person in-charge of the company which, in our case, is the Prime Minister. The CEO and directors of PETRONAS are like the managers employed to manage the company.

With the so-called “regulatory power” given to Sarawak over oil and gas industry in Sarawak, Sarawak’s role is just analogous to a regional manager who has no ownership rights over the assets of the company (which is the oil and gas), but receives a salary for his work.

That also explains why Abang Jo has repeatedly mentioned the phrase “Prime Minister has agreed to”. It is just like the boss having agreed to engage Sarawak as its regional manager to run some of the operations while the main decision-making remains with the Prime Minister and the ownership remains with PETRONAS which is also under the control of the Prime Minister.

Therefore, the big show of Abang Jo in announcing the so-called “regulatory power” is just a cover-up for the failure on the part of Sarawak BN to obtain the 20% oil and gas royalties as resolved by the Sarawak DUN during the late Adenan’s time. It remains “hot air” of Abang Jo.

• Chong Chieng Jen is Sarawak Pakatan Harapan Chairman/DAP Sarawak Chairman/MP for Bandar Kuching/ADUN for Kota Sentosa