State legislative assembly never endorsed PDA, says Sarawak CM

Abang Johari Openg says the Oil Mining Ordinance 1958 which gives Sarawak full regulatory authority over the O&G industry in Sarawak is still in force.

Sarawak is looking to enforce the Oil Mining Ordinance 1958 along with the Gas Distribution Ordinance 2016 beginning July 1. (Bernama pic)

PETALING JAYA: Sarawak Chief Minister Abang Johari Openg says the state legislative assembly never endorsed the Petroleum Development Act (PDA) 1974, the law on which Petronas is relying in its bid to declare its exclusive ownership of the country’s petroleum resources.

In his winding-up speech at the assembly yesterday, he said Sarawak was glad that Petronas’ application for a court declaration that the PDA had “implicitly” repealed the Oil Mining Ordinance 1958 (OMO 1958) was rejected.

“OMO 1958 gives Sarawak full regulatory authority over all persons and companies involved in the operations of the oil and gas industry in Sarawak,” he was quoted as saying by the Borneo Post.

He added that the OMO 1958 was still in effect, and that the state was looking to enforce the law along with the Gas Distribution Ordinance 2016 beginning July 1.

This would be done through the Sarawak Minerals and Management Authority, through Petroleum Sarawak Bhd, he said in the report.

On June 4, Petronas announced that it was seeking a Federal Court declaration of the PDA.

It also sought a declaration that Petronas, in line with the PDA, is the exclusive owner of the petroleum resources and the regulator for the upstream industry throughout Malaysia, including in Sarawak.

This was after Sarawak in March asserted its right to its oil resources, with local media reporting that it was set to assume full regulatory authority for the upstream and downstream industries in the oil and gas-rich state from July.

A backlash arose in Sarawak over Petronas’ move, with local-based parties like SUPP saying all oil and gas resources in Sarawak’s continental shelf belong to the state.

SUPP president Dr Sim Kui Hian also said that the PDA was passed without the consent of the Sarawak state assembly, and that the ownership of oil and gas should therefore be returned to Sarawak.

On June 22, the Federal Court refused to hear whether Parliament is competent to make laws on oil and gas exploration activities nationwide.

Chief Judge of Malaya Ahmad Maarop said the court had no jurisdiction to hear the matter as the declaration sought did not fall within the ambit of Articles 4(4) and 128 of the Federal Constitution.

“Petronas did not ask for a specific declaration whether Sarawak’s OMO 1958 is valid,” he said.

He added that the Sarawak government had not denied that Parliament has the power to enact the PDA.

Petronas can now either file a fresh leave application with a modified prayer for a declaration, or institute a suit in the High Court. -FMT