Adenan misleading Sarawakians on oil royalty

DAP Sarawak fired a warning shot when it said the Federal and Sarawak governments must not substitute the 20 per cent oil royalty with only 10 per cent in various gas projects.

KUCHING: Sarawak DAP has warned the people that Chief Minister Adenan Satem is trying to pull the wool over their eyes by linking a measly 10 per cent stake in various gas projects, the latest being in MLNG.4, with the 20 per cent oil royalty demand.

Sarawak DAP Chief and DAP National vice-chairman Chong Chieng Jen urged Adenan to come clean on his recent talks with Petronas on the oil issue.

“The 20 per cent oil royalty and the stakes in gas projects are separate issues,” said Chong.

He was commenting on Adenan’s statement earlier this week that “Petronas has agreed to offer Sarawak a 10 per cent stake in MLNG.4” and that “this is the result of the state’s negotiation with Petronas to increase the oil and gas royalty to 20 per cent”.

The 10 per cent is not free, pointed out Chong who is also the Kuching MP and Kota Sentosa state assemblyman. “It’s like buying shares in a company. If no profits, there will be no dividends.”

The 20 per cent oil royalty on the other hand, continued Chong, would have to be paid whether or not the oil contractor/Petronas makes profits.

“Sarawak does not have to pay for this 20 per cent oil royalty stake unlike the stakes in the gas projects,” said Chong. “The 20 per cent oil royalty is cash payment upfront in compensation for our oil and gas reserves.”

At the moment, stressed Chong, Petronas is paying Sarawak only 5 per cent in oil royalty.

MLNG.4, added Chong is not the first gas project in which the Sarawak government has a stake.

He cited the other gas projects as MLNG, MLNG.2 and MLNG.3, all with a 10 per cent stake belonging to the Sarawak government.

Sarawak Assembly unanimously passed a resolution on the 20 per cent oil royalty demand.

The DAP Sarawak Chief fired a warning shot when he said the Federal and Sarawak governments must not substitute the 20 per oil royalty demand with the possibility of an increase in federal funding for development projects in the state.

“The 20 per cent oil royalty demand and federal funding for development expenditure must not be linked as they are separate issues.

“The Federal government and Petronas must take heed of the demand for an increase in the oil royalty from the present 5 per cent to 20 per cent,” he said.

He referred to the Sarawak Assembly unanimously passing a resolution on the 20 per cent oil royalty demand.