Wednesday, March 10, 2010

Pakatan to hold referendum on 15% oil royalty proposal

Pakatan Rakyat will hold a referendum on its proposal to give oil-producing states -- Sabah, Sarawak, Kelantan and Terengganu -- 15 percent of oil royalties when it comes into federal power.

Kelantan’s senior state executive councillor Datuk Husam Musa said he and Gua Musang parliamentarian Tengku Razaleigh Hamzah will explain their proposal to the people when they go on a nationwide roadshow beginning March 18 in Terengganu.

Tengku Razaleigh, or Ku Li, the former chairman of Petroleum Nasional (Petronas), played a pivotal in working out the Petroleum Development Act 1974 on oil royalties.

Said Husam: “We will travel the length and breath of the country explaining the issue and why Kelantan is firm in its stand that it rightfully deserves what was promised to the state.

“In our proposal, Sabah, Sarawak, Kelantan and Terengganu will get 15 percent in oil royalties while the federal administration gets its five percent," he said.

Poorer states need the money

Husam explained that the decision to include Sabah and Sarawak in the referendum was in recognition of the goodwill and understanding that dated back to Sarawak’s first oil find.

“At the beginning, Sarawak was to have received 12 percent in oil royalties. But because Petronas was still a fledgling company at the time, a compromise was struck.

"Petronas agreed to give both Sabah and Sarawak five percent in royalties. The aim was to help Petronas consolidate its financials," said Husam.

“This goodwill gesture was eventually buried. Petronas funds were channelled to projects like the RM1 billion Formula One event, which has brought little benefit to the people.

"‘We now have to return the money to the poorer states and ensure that they receive more," he added.

Husam said the Pakatan coalition will be explaining the issue to Sarawakians as part of their election campaign.

“We will tells the Sarawakians that if they want the 15 percent oil royalties, then they should vote Pakatan Rakyat into power in the state."

He said the oil royalty issue was one of the initiatives that Pakatan would take to the people.

Kelantan has been at loggerheads with the federal government over its demand for cash payment on oil royalties in accordance with its original agreement with Petronas.

The federal government has stubbornly refused to acknowledge Kelantan’s claims. It has instead decided to pay wang ehsan or compassionate funds to the state.

courtesy of FreeMalaysiaToday

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