Petronas not involved in Sarawak’s oil royalty discussion, says group CEO

Jamny Rosli
Petronas CEO Tan Sri Wan Zulkiflee Wan Ariffin speaks during a news conference in Kuala Lumpur, August 30, 2018. — Picture by Ham Abu Bakar

KUALA LUMPUR, Aug 30 — Petroliam Nasional Bhd (Petronas) is not involved in negotiations over Sarawak’s request for higher oil royalty, said the national oil company’s president and group chief executive officer Tan Sri Wan Zulkiflee Wan Ariffin.

He said the matter was being handled by the state and federal governments, while Petronas was only dealing with Petroleum Sarawak Bhd (Petros) on the working arrangement between them.

“We are leaving the discussion on the percentage of the oil royalty, which is currently at 5 per cent, to the federal and state government.

“We’ll be guided by whatever outcome from those discussions, but we’re not involved in the discussion.

“But, in terms of our day-to-day interaction with Petros, (we’re discussing) on how working arrangement can be sorted out that is mutually acceptable for both parties,” he told reporters after announcing Petronas’ financial results for the first half of the year.

Wan Zulkiflee said the most important thing is to keep the oil and gas industry in Malaysia resilient and make the country an attractive investment destination for foreign oil and gas companies.

Asked whether the production sharing contracts (PSCs) will report to Petronas or to Petros in Sarawak, he said PSCs will report to Petronas because their agreements are with Petronas.

“The agreement that PSCs have is with Petronas and that continues. About the licensing and barrel price the matter is still under discussion at the moment.

“According to our understanding, the grace period for us to settle all this will be until end of next year,” he said.

He added that currently, Petronas is not in discussion with any other oil producing states apart from Sarawak.

Sarawak has started to regulate all oil and gas activities in the state since July 1, this year, with Petros as its regulatory arm.

Related Articles Petronas revises 2018 government dividend to RM24b, from RM19b Petronas confirms Abdullah Ahmad Badawi’s last day as adviser on Aug 31 Petronas, Litar Sepang pertama kali anjur MotoGP musim depan