Dr M’s offer to sell Petronas stake will affect Kimanis by-election, warns MP

Kota Kinabalu MP Chan Foong Hin says it is not right to raise funds for the federal government by selling Petronas shares to the state governments.

KOTA KINABALU: A Sabah MP is worried that Prime Minister Dr Mahathir Mohamad’s statement on selling Petronas stakes to Sabah and Sarawak could cost the ruling government the Kimanis by-election.

Kota Kinabalu MP Chan Foong Hin, in a statement today, expressed his concerns that Mahathir’s remarks might backfire if misinterpreted by the people, especially with the by-election coming up.

“It would be good if Tun, as the coalition leader of Pakatan Harapan, could consult with the Warisan-led Sabah government before making any statement that may be easily misconstrued,” he said.

Mahathir had said in an interview with Reuters that the government would consider selling Petronas stakes to Sabah and Sarawak, as the two states demand a bigger share of revenues from oil extracted from their territories.

He said Putrajaya could not meet the states’ demand to increase the royalties paid by Petronas to 20%, but the government could let go of its stakes in smaller units of Petronas.

Sabah and Sarawak hold more than 60% of Malaysia’s oil reserves.

Chan, who is Sabah DAP secretary, questioned whether Mahathir Mohamad had been misguided when he had mentioned “selling” stakes in Petronas to oil-producing states in the country.

“It is not right to raise funds for the federal government by selling Petronas shares to the state governments.

“I believe that the prime minister, in his infinite wisdom, would be able to come up with many other creative ways to raise funds needed to settle federal debts,” he said.

Towards this end, Chan contended that what Mahathir had truly wanted was to suggest fulfilling PH’s manifesto of paying 20% petroleum royalty or its equivalent to Sabah and Sarawak by way of transferring part of the federal government’s ownership in Petronas to the states.

He said he would welcome this suggestion.

“If so, the Sabah government should pay only a token of RM1 at most for the transfer of the shares in Petronas to them,” he added.

He said the amount of Petronas shares to be offered to the state as an alternative to the 20% oil royalty has to be at least equivalent to the percentage of petroleum produced by the state in the country.

“In fact, it would be best if the dividend payable yearly through the Petronas shares to be transferred to the state government is able to cover the 20% royalty payment.”

Chan said he still could not fathom why the federal government kept on claiming that it could not satisfy the demand for the 20% oil royalty until now.

“Just like GST (goods and services tax) repayments, the 20% payments to oil-producing states ought to be set aside specifically, probably put into a trust account, and not be used for other purposes,” he said.

Meanwhile, Chan said there were only four issues pending at the special Cabinet committee to review the implementation of the Malaysia Agreement 1963.

These are oil royalty issues and petroleum cash payments; minerals and oil fields; Territorial Sea Act 2012; and state rights over the continental shelf. - FMT