KUCHING, April 23 — Batu Lintang state assemblyman See Chee How said today Petronas could afford to increase the oil royalty payment to Sarawak from the present 5 per cent as it has made good profit after tax in 2016, despite a slump in the crude oil price in the international market.
He said Petronas’ after-tax profit has grown 12 per cent to RM23.5 billion for the year 2016, from the RM20.9 billion in 2015.
“Based on the after-tax profit, I see no reason why Petronas cannot increase the royalty payment to Sarawak,” he said when presenting a paper on the Territorial Sovereignty and Rights to Resources at the Sarawak’s Rights and Referendum public forum here.
See, who is also Sarawak PKR vice chairman, said he disagreed with Chief Minister Datuk Amar Abang Johari Abang Openg that Sarawak would go slow on asking the federal government and Petronas to increase the oil royalty from 5 per cent to 20 per cent on grounds of low price of crude oil in the international market.
In the May 2014 session, the Sarawak State Legislative Assembly unanimously voted in favour of a resolution to request the federal government for an increase in the oil royalty from 5 per cent to 20 per cent.
The resolution was in line with the then-Chief Minister Tan Sri Adenan Satem’s statement in support of an increased royalty.
However, the negotiation between the state and federal government for the increase in royalty payment was hampered by the low price of crude oil.
See said that since 2009 Petronas made huge profits and was a major contributor to the federal government’s coffer.
“From dividends alone, Petronas had paid about RM500 billion in taxes, royalties and export duties, together with RM200 billion in gas subsidy, from 2010 to 2016,” he said, pointing out that Sarawak was the biggest contributor in terms of oil and gas production and petroleum revenue earning for Malaysia, but received a small fraction in return.
He called on the state government to set up a body, such a state sovereign wealth fund, to undertake upstream and downstream oil and gas projects in Sarawak’s territory.
“We must assert our sovereign rights to petroleum resources, our autonomy and authority over the remaining blocks and fields of oil and gas potentials yet to be awarded with the Production Sharing Contracts,” he said.