PETALING JAYA: Former finance minister Tengku Razaleigh Hamzah has recalled how the Petroleum Development Act 1974 (PDA) became a cornerstone of national unity, ensuring Malaysia’s control over its oil and gas resources.
Razaleigh, also known as Ku Li, said that before independence and the formation of Malaysia, hydrocarbon assets were owned by the British and managed by Royal Dutch Shell, which reaped billions of ringgit in profit.
In a podcast with Machang MP Wan Ahmad Fayhsal Wan Ahmad Kamal, Razaleigh said concerns grew after Malaysia’s formation in 1963, when then Sarawak chief minister Abdul Rahman Ya’kub feared that the country might split up, like when Singapore left the federation.
“Rahman asked us to think of ways that this vital asset could become our common property,” Razaleigh said.
Razaleigh said he was tasked with seeking the agreement of state leaders, which led to the creation of Petronas under an Act of Parliament and the adoption of the production sharing contract model.
“Because of that unity, Royal Dutch Shell eventually bowed and returned the oil and gas rights to us. That’s how the agreements under the PDA came about.”
However, Razaleigh warned that political disputes were now undermining the unity that once strengthened the country.
He cautioned that prolonged disputes could invite foreign interference and stressed that Malaysia’s strength lay in its unity.
“If funds are insufficient, discuss it openly with MPs and ministers. State clearly how much is needed. Don’t keep quarrelling over legal interpretations as everyone has their own view of the law,” he said.
“Do we want outsiders to be our arbitrators? That would open the door to international involvement. If we don’t respect our own agreements, foreign investors certainly won’t.
“In the past, we stood united, and we succeeded in freeing our economy from foreign domination. If we keep quarrelling, investors will stay away, and we are the ones who will lose.”
Law and institutional reform minister Azalina Othman Said said last month that Petronas’s rights to oil and gas resources in Sarawak remained protected under the PDA.
In a written parliamentary reply, Azalina said Petronas held full ownership and exclusive rights to explore and extract petroleum in Malaysia, both onshore and offshore.
She was responding to Hassan Abdul Karim (PH-Pasir Gudang), who had asked about the extent to which the federal government would defend the PDA as a foundation of the country’s economic sovereignty in the oil and gas industry.
This was in light of claims by the Sarawak government and Petroleum Sarawak Bhd, which he said challenged the position of Petronas under the Act, Bernama reported.
