BEFORE implementing 20% oil royalty for Sabah, Petroliam Nasional Bhd’s (Petronas’) strength needed to be secured first, Dr Mahathir Mohamad said.

The prime minister said any hasty decision could lead to the national oil company’s downfall.

“We don’t want to kill Petronas. Taking 40% from the company’s operating cost will cause it to lose money.

“So, (if) we reduce Petronas to just collecting royalty, then, we will lose a lot of things (opportunities).

“So, we need to maintain the strength of the national oil company.”

He said the federal government also gave out money to the states in the form of loans, some of which were non-performing loans (NPL). 

“NPL means we can bankrupt you. The states have money, they are even offering to lend money to the federal government,” he said in Kota Kinabalu today.

Earlier, Dr Mahathir had lauded Sabah on the progress undergone in the state since his last visit.

He said Sabah had the potential to achieve economic excellence, but that it was unfortunate that the cost of living had gone up due to the corruption of the previous government. 

“I think it is evident that Sabah is capable of growing very fast. You have land, you have mountains, you have seas, beaches, temperatures that are low, which may be good for growing vegetables. So, the potential is good. 

“But what happened was costs went up because of corruption. When you have to divert money for corruption, that costs the country.

“I think I will stop because I tend to adopt the Chinese law where we shoot people. Sometimes I joke, but don’t take me too seriously,” he said.   

Dr Mahathir also reminisced about his first visit to the state in 1965, when its former chief minister, Harris Salleh, had a Jaguar but less than 32km to drive as there were barely any roads in the state at the time. – September 17, 2018.