Jeffrey Kitingan says Sabah Sarawak should move to review oil agreement and revoke the ‘illegal’ Petroleum Development Act
KOTA KINABALU: The promise of oil riches has always hung over Sabah and Sarawak – just out of reach maybe but tantalisingly close. So close in fact that Jeffrey Kitingan, a politician who wears many hats, says both states can strike it rich if they act in tandem now.
The Harvard University graduate who is the state legislative assembly representative for Bingkor, president of the NGO, Borneo Heritage Foundation, and STAR Sabah chairman, said the governments of both states should pass a motion in their respective Legislative Assemblies to review the soft deal they struck with the federal government 38 years ago.
He calls the deal that saw Sabah and Sarawak give up their oil and gas wealth in return for a 5% royalty payment the Petroleum ‘Surrender’ Agreement (PSA).
Jeffrey says once the state government’s did this they could work with opposition MPs to revoke or outlaw the Petroleum Development Act (PDA) 1974.
But time is of the essence for this to work, he said in a statement today.
“The Sabah and Sarawak Government must act quickly while they still can as political conditions in the country may change at any given moment,” he said referring to how the Barisan Nasional coalition government at federal level rules at the pleasure of MPs from both states.
He said only the support of Sabah and Sarawak is keeping Najib Razak as Prime Minister and Pakatan Rakyat leader Anwar Ibrahim at arms lenght.
Jeffrey argues that the Chief Ministers of Sabah and Sarawak could play their strategic cards well in this situation to leverage their position.
“If Pakatan is genuine and sincere in their struggle for justice and autonomy for the Borneo States, they will surely support the motion,” said Jeffrey who added he nevertheless doubted they would.
Najib, on the other hand, he said, would do anything to save his government and and would be hard pressed not to give in to the demands of the Borneo States.
“If the leaders and Government of Sabah and Sarawak failed to make this move then it is obvious that their self interests command their political life and not the common interest of Sabah and Sarawak and their people,” he said.
But Jeffrey also cautioned that even if they pursued the course of action he is proposing, federal government leaders would always want to maintain control of the nation’s most strategic and powerful resource.
With 46% of the nation’s revenue coming from petroleum of which 85% is derived from Sabah and Sarawak, the stakes are high.
Former Sabah chief minister, Harris Salleh, stated that he was ‘forced’ into signing the PSA in 1976 when the federal government said oil found off-shore Sabah belonged to the federal government and signing and getting 5% was better than getting nothing at all.
However, the two chief ministers before him, Mustapha Harun and Fuad Stephens, refused to sign the PSA forcing the federal government to plead to the state government under Harris to agree to the deal days after Stephens and several key members for his cabinet were killed in a plane crash.
Jeffrey and several legal authorities say the PDA that was passed by parliament in 1974 is unconstitutional and is a piece of legislation simply passed to seize the assets and resources of Sabah and Sarawak.
They say the oil and gas rights belong to the Borneo states which were protected in the Federal Constitution and the federal parliament had no authority to pass the PDA.
They argue that Abdul Razak, Najib’s father who was prime minister at the time, had no legal right to sign the Vesting Order in 1975 pursuant to the PDA and vesting the oil and gas ownership rights in Petronas in perpetuity.
“In a single signature, Razak, ‘robbed’ Sabah and Sarawak of their oil and gas ownership rights.
“It has to be remembered that before 1974 Sarawak was already producing oil and collecting its own oil revenue,” Jeffrey said.
“In Sabah, oil exploration started in the late 1960s and the Sabah government had signed oil agreements with oil companies to collect the oil revenue including collection of rents on the oil areas and oil production started before the 1976 PSA,” he added.
The assemblyman who has been campaigning for Sabah’s rights for close on 30 years said it was unconscionable for Petronas and the federal government to seize all of both states’ oil and gas and give back 5%.
This year, Sarawak will contribute about RM50 billion in oil and gas revenue and Sabah another RM26.6 billion to the federal purse. This amount is expected to rise to RM50 billion in another year or so.
What causes consternation in Sabah and Sarawak, Jeffrey said, is that while Petronas grows richer and the federal government focuses on development projects and amenities in the peninsula the two Borneo states languish as the poorest and second poorest in Malaysia.
Borneo Insider
KOTA KINABALU: The promise of oil riches has always hung over Sabah and Sarawak – just out of reach maybe but tantalisingly close. So close in fact that Jeffrey Kitingan, a politician who wears many hats, says both states can strike it rich if they act in tandem now.
The Harvard University graduate who is the state legislative assembly representative for Bingkor, president of the NGO, Borneo Heritage Foundation, and STAR Sabah chairman, said the governments of both states should pass a motion in their respective Legislative Assemblies to review the soft deal they struck with the federal government 38 years ago.
He calls the deal that saw Sabah and Sarawak give up their oil and gas wealth in return for a 5% royalty payment the Petroleum ‘Surrender’ Agreement (PSA).
Jeffrey says once the state government’s did this they could work with opposition MPs to revoke or outlaw the Petroleum Development Act (PDA) 1974.
But time is of the essence for this to work, he said in a statement today.
“The Sabah and Sarawak Government must act quickly while they still can as political conditions in the country may change at any given moment,” he said referring to how the Barisan Nasional coalition government at federal level rules at the pleasure of MPs from both states.
He said only the support of Sabah and Sarawak is keeping Najib Razak as Prime Minister and Pakatan Rakyat leader Anwar Ibrahim at arms lenght.
Jeffrey argues that the Chief Ministers of Sabah and Sarawak could play their strategic cards well in this situation to leverage their position.
“If Pakatan is genuine and sincere in their struggle for justice and autonomy for the Borneo States, they will surely support the motion,” said Jeffrey who added he nevertheless doubted they would.
Najib, on the other hand, he said, would do anything to save his government and and would be hard pressed not to give in to the demands of the Borneo States.
“If the leaders and Government of Sabah and Sarawak failed to make this move then it is obvious that their self interests command their political life and not the common interest of Sabah and Sarawak and their people,” he said.
But Jeffrey also cautioned that even if they pursued the course of action he is proposing, federal government leaders would always want to maintain control of the nation’s most strategic and powerful resource.
With 46% of the nation’s revenue coming from petroleum of which 85% is derived from Sabah and Sarawak, the stakes are high.
Former Sabah chief minister, Harris Salleh, stated that he was ‘forced’ into signing the PSA in 1976 when the federal government said oil found off-shore Sabah belonged to the federal government and signing and getting 5% was better than getting nothing at all.
However, the two chief ministers before him, Mustapha Harun and Fuad Stephens, refused to sign the PSA forcing the federal government to plead to the state government under Harris to agree to the deal days after Stephens and several key members for his cabinet were killed in a plane crash.
Jeffrey and several legal authorities say the PDA that was passed by parliament in 1974 is unconstitutional and is a piece of legislation simply passed to seize the assets and resources of Sabah and Sarawak.
They say the oil and gas rights belong to the Borneo states which were protected in the Federal Constitution and the federal parliament had no authority to pass the PDA.
They argue that Abdul Razak, Najib’s father who was prime minister at the time, had no legal right to sign the Vesting Order in 1975 pursuant to the PDA and vesting the oil and gas ownership rights in Petronas in perpetuity.
“In a single signature, Razak, ‘robbed’ Sabah and Sarawak of their oil and gas ownership rights.
“It has to be remembered that before 1974 Sarawak was already producing oil and collecting its own oil revenue,” Jeffrey said.
“In Sabah, oil exploration started in the late 1960s and the Sabah government had signed oil agreements with oil companies to collect the oil revenue including collection of rents on the oil areas and oil production started before the 1976 PSA,” he added.
The assemblyman who has been campaigning for Sabah’s rights for close on 30 years said it was unconscionable for Petronas and the federal government to seize all of both states’ oil and gas and give back 5%.
This year, Sarawak will contribute about RM50 billion in oil and gas revenue and Sabah another RM26.6 billion to the federal purse. This amount is expected to rise to RM50 billion in another year or so.
What causes consternation in Sabah and Sarawak, Jeffrey said, is that while Petronas grows richer and the federal government focuses on development projects and amenities in the peninsula the two Borneo states languish as the poorest and second poorest in Malaysia.
Borneo Insider
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