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‘20 pct oil and gas royalty a reasonable request’

Posted on May 8, 2014, Thursday

KUCHING: Requesting for an increase of oil and gas royalty from the present five per cent to 20 per cent is reasonable.

Social Development Minister Tan Sri William Mawan said it was about time the 1974 agreement was revised.

He believed the new stand taken by the state would not affect its good relations with the federal government.

The proposal is a matter of the state exercising its rights, which is always negotiable.

“Oil and gas revenue that are being derived by the federal government from here is ploughed back to our state in terms of federal fund allocation; we are talking about what is exclusively ours, and what is due to us. So this has become an issue over time.

“I believe that it is an appropriate and very reasonable stand taken by the government, without having to hurt each other’s feelings,” Mawan who is also a senior minister in the state cabinet told reporters when met at the State Legislative Assembly (DUN) complex here yesterday.

Following the approval of the august house for the state to request for an increase in oil and gas royalty during the DUN sitting on Tuesday, he hoped the discussions would be constructive and yield positive results.

“We have to understand the federal government’s position but at the same time, our federal counterpart still has to understand the state’s position as the guardian of Sarawak’s rights and properties.

“This issue will be brought up with the federal government in a friendly manner at the most appropriate time, so that the people feel that we are doing our duty in a very fair manner.

“What belongs to us should be given to us; it is not something we should quarrel about because we are one in the same government – state and federal,” Mawan reminded.

He pointed out that funds derived from the state’s oil and gas would be channelled to the state via the federal fund.

Mawan who is Pakan assemblyman and Saratok MP said he believed if the request for an increase in oil and gas revenue was handled in a professional and good manner, it might not come as a surprise if the Federal Government gave the state slightly more than what it asked for.

The motion passed in the august house on Tuesday has achieved landmark status as it was unanimously given the ‘aye’ by both sides of the political divide.

It is understood that the current five per cent royalty translates to more than RM1.6 billion, so an additional 15 per cent would bring in RM5 billion more to the state’s coffer.

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