.JPG "Kota Bharu MP Datuk Takiyuddin Hassan speaks to reporters at Parliament in Kuala Lumpur November 12, 2019. u00e2u20acu201d Picture by Miera Zulyana")
KUALA LUMPUR, Nov 25 — The thorny oil royalty row between PAS-led Kelantan and Pakatan Harapan-ruled Putrajaya can only be resolved after the state and federal governments determine the number of oil fields within the northeast state’s borders, a Singaporean daily reported today.
PAS secretary-general Datuk Takiyuddin Hassan told The Straits Times that Kelantan only received RM15.75 million last September in what he called “wang ehsan” or a “goodwill” payment instead of the RM1 billion in royalty demanded.
“We have to settle the boundary issue first so that they will pay the royalty,” Takiyuddin was quoted saying.
Kelantan is demanding RM1 billion in royalty for 12 oil fields off its coast.
But Economic Affairs Minister Datuk Seri Azmin Ali said that only two are confirmed to be within three nautical miles from the state shoreline, adding that there is a need to check if the remaining 10 fields outside of that area belong to Kelantan or its neighbours, whether Pahang or Terengganu.
“If all 10 fields are in Kelantan waters, I give a guarantee that Petronas will make cash payments directly to Kelantan. If they belong to Pahang, then I have a responsibility to see that payments are made to Pahang,” he was quoted telling Parliament on October 30.
ST said however that both Azmin and Takiyuddin did not speak of the government body that would be responsible for checking the maritime boundaries or a fixed timeline.
Political risk consultancy firm KRA Group’s strategy director Amir Fareed Rahim was reported saying that the oil royalty payment has always been a “sticky issue” between the Kelantan state government and the federal government especially when Dr Mahathir was leading it.
“Therefore the latest twist in the issue is not a surprise and it will drag on for as long as it could as it is always used by the federal government to keep Kelantan in check,” he was quoted saying by ST.
According to the Singapore daily, the decades-old dispute over oil royalty payment originated from when Tun Dr Mahathir Mohamad was prime minister leading the Barisan Nasional (BN) federal government.
He was reputedly not been keen to pay a 5 per cent oil royalty to Kelantan in the past, to prevent PAS from enhancing its political war chest with the money.
However, Terengganu, which is also under PAS rule, has received RM1.277 billion oil royalty from the new PH federal government.
PAS president Datuk Seri Abdul Hadi Awang recently said that Dr Mahathir had corrected the situation by agreeing to resume oil royalty payment said to be illegally cancelled by the previous BN government, after their meeting following PH’s victory in last year’s general election.
Since the June 2018 meeting where Terengganu Mentri Besar Ahmad Samsuri Mokhtar was also present, Hadi had on other occasions met Dr Mahathir while PAS has expressed support for the latter and even said it would want him to be prime minister for the full five-year term.
Under its electoral promise to share the nation’s wealth in a targeted and equitable manner, PH had pledged that it would immediately stop the “cruelty” of former ruling parties Umno and BN in denying oil royalty payments to oil and gas producing states based on their political leanings.
“The Pakatan Harapan government will increase the royalty payment to Sabah and Sarawak, and other oil producing states, to 20 per cent or of its value equivalent, so that the respective states can take over and fund more of their own development activities,” the PH coalition had said in its manifesto for the 2018 elections.
