Giving 20% royalty won’t bankrupt Petronas, says Shafie

Sabah Chief Minister Shafie Apdal says Sabah produces almost half of the crude oil in the country and should have a fair share of those resources. (Bernama pic)

KOTA KINABALU: Sabah Chief Minister Shafie Apdal says Petronas will not go bankrupt if it gives Sabah and other oil-producing states 20% of gross petroleum production, up from the present 5%.

He said the national oil company gave the federal government RM32 billion in dividends alone in 2013.

“This is just one of the things that Petronas gives to the federal government.

“The federal government also gets a 5% share from gross production as well as corporate taxes.

“Meanwhile, Sabah only gets 5% of gross production.

“We don’t mind sharing our resources but it is a fact that Sabah produces almost half of the crude oil in the country. So, why can’t we have a fair share of those resources?” he told reporters at an event to mark the 100th day of the new state government.

Shafie said the state Cabinet was determined to get the 20% of gross production from Petronas as this is one of the promises in their manifesto and he has met with Petronas to convey the demand.

However, he admitted it was not an easy task because the issue has been there for decades.

Even though the federal government, through the economic affairs ministry, has announced it will give 20% royalty to oil-producing states, the quantum will be based on net profit and not gross production.

Shafie said the decision is not in tandem with the demands of the Sabah people.

Thus, Shafie intends to meet Economic Affairs Minister Mohamed Azmin Ali and Prime Minister Dr Mahathir Mohammad to discuss the issue.

At the same time, he said the state government was also working hard to get back the 40% net revenue for Sabah owed by the federal government, as provided in the Federal Constitution.

“We are only requesting this because Sabah, being one of the biggest states, needs more money to develop and ensure we can provide jobs for our people.

“Our youths have to migrate to find jobs because we don’t have enough jobs in Sabah.

“With this money, we can sort out a lot of things. We can set up industries here and give our people jobs,” he said.

Commenting on the state government’s 100 days in office, Shafie said he realised that many of the promises made during the May election could not be fulfilled immediately or within 100 days.

Nevertheless, he said, even in this short span of time, his government had managed to carry out a lot of things despite the many hurdles, especially financial problems and inefficient administration left by the previous state government.

Parti Warisan Sabah, the lead party in the Sabah coalition, made 13 major promises in its manifesto, divided into four main components.

These components involve people’s rights and enactments under the state government that must be upheld and maintained; addressing deficiencies in the government; formulating development plans to improve quality of life; and improving efficiency of civil servants to serve the people.

“We have managed to do something to empower Sabah’s autonomy in education by setting up an education and innovation ministry. We have also set up a health ministry.

“Both these ministries are crucial to complement the jobs and roles of their counterparts at the federal level.

“The federal ministries can now depend on the state ministries that know the needs of the people in Sabah better,” he said.

In terms of education, Shafie said he envisioned Sabah to have more skilled workers who are readily employable instead of just institutions designed to churn out PhD holders.

At the same time, the health system in Sabah needs a major overhaul as the state government wants to ensure a healthier society to help it develop the state.

Shafie also said the state government had fulfilled its promise to abolish communal land grants and will replace it with a new approach to give land to natives directly.

“For those who are already in the communal grant system, we will divide the grants and do new surveys so they will be given land under their own names.

“Those who have already partnered with contractors to develop their land can continue to do so but we will not force the others to do the same.

“If they want to develop their land themselves, then they are more than welcome to do so,” he said.

Previously, some of those under the communal grant system reported that they were forced to do a joint venture with contractors, normally appointed by the state government, to develop their land for oil palm or to be rubber plantations.

Beneficiaries of the communal grant system do not have individual land titles as the title will remain with the state government.

The system was criticised by activists who claimed the government will include names of outsiders in the list of beneficiaries, thus denying the rights of natives who have been living in the area for generations.