SARAWAKIANS are proceeding with caution on the statement made by Prime Minister Dr Mahathir Mohamad in Parliament yesterday concerning the 20% oil payment to be made to the oil-producing state.

Some news reports said Dr Mahathir said oil-producing states would get a “20% royalty”, as was promised by in Pakatan Harapan’s election manifesto, but others reported that he said “20% profit”.

“Am I happy with the PM’s announcement yesterday that oil producing states get 20%?”

“No, definitely I am not,” said state Tourism, Arts, Culture, Youth and Sports Minister Abdul Karim Rahman Hamzah.

“At one point, Dr Mahathir said oil-producing states would get 20% royalty. At another point, he said these states would get 20% of the profit.

“Those are two vastly different things,” he told The Malaysian Insight.

Karim said the remarks were made “just to make Sarawakians ‘syok sendiri’ in thinking that the PH government was addressing its election manifesto”.

“In actual fact, 20% of the profit could be less than the 5% royalty Sarawak is getting now, if the cost of oil extraction is high and world market price is low.”

State Reform Party (STAR) Sarawak president Lina Soo, meanwhile, questioned whether Dr Mahathir had “moved the goalposts” so as to be seen as fulfilling its election promises in changing its 20% royalty pledge to profit.

“Is the PH government trying to avoid paying Sarawak 20% royalty through creative accounting?

“It may turn out that 20% of profit is lower than 5% gross production – 20% of nothing is nothing.”

Soo also questioned whether this was a way to divert focus from the real issue of ownership of oil and gas resources in Sarawak. 

She said this latest episode showed the Sarawak government needed to quickly resolve the dispute over rights and ownership.

However, a PH state lawmaker defended Dr Mahathir, saying he “cannot shift what is in the PH manifesto on his own and without good reason”.

“The manifesto expressly said 20% royalty,” said Batu Lintang assemblyman and Sarawak PKR vice-chairman See Chee How.

He said it was more likely “profit” was a “slip (of the tongue)”.

Former DAP state lawmaker Voon Lee Shan said the tussle over Sarawak’s oil and gas resources showed that Putrajaya’s mistreatment of the state was ingrained and that Sarawak should not be happy with getting just 20% royalty.

“We want 100% ownership of our oil, plus interest and damages,” Voon said, citing potential losses Sarawak suffered since the enforcement of the Petroleum Development Act 1974, which gives national oil company Petronas absolute ownership and monoply over all oil resources in the country.

Sarawak has long debated the validity of the act, with leaders saying it has legal bearing in the state as its legislative assembly has never ratified the law. – July 20, 2018.