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Opposition ready to strengthen PDA, defend Petronas, says Wan Fayhsal
Machang MP Wan Ahmad Fayhsal Wan Ahmad Kamal warned against any move that could weaken the national oil corporation, citing its vital role in Malaysia’s economic growth. File pic by X@BernamaBiz. Pic for illustration purposes
KUALA LUMPUR: An opposition politician says Perikatan Nasional is ready to support efforts to strengthen the Petroleum Development Act 1974 (PDA) to ensure Petronas remains a pillar of national development.
Machang MP Wan Ahmad Fayhsal Wan Ahmad Kamal warned against any move that could weaken the national oil corporation, citing its vital role in Malaysia’s economic growth.
“If the prime minister requires Petronas to be strengthened in terms of governance and independence, the opposition will support that call to ensure that the PDA remains intact and effective for Petronas to deliver benefits to the rakyat.
“Petronas is a geoeconomic institution. It not only generates cash for the country but also develops talent, builds expertise, and serves as a diplomatic channel for Malaysia to venture abroad.
“Why kill our best player on the team when you can’t produce the same kind of player in the next 10 or 20 years? As a politician who thinks about the future of our country, I would defend Petronas to the last mile,” he told FMT in an exclusive interview.
The PDA vests Petronas with ownership in, and control over, all upstream and downstream oil and gas activities in Malaysia.
Currently, Petronas and Sarawak’s state-owned oil company, Petroleum Sarawak Berhad (Petros), are negotiating a new arrangement over gas rights in the state.
Sarawak has recently claimed it is entitled to exploit oil and gas reserves in and around the state, despite the PDA assigning exclusive rights to Petronas.
Wan Fayhsal acknowledged the grievances of states like Sarawak and Kelantan over oil revenue distribution but insisted that any solution reached must not come at the expense of Petronas’s strength.
“Whatever the issues may be, they must be discussed at the negotiating table. The solution must be a win-win proposal and must not weaken Petronas at any cost.
“If the issue concerns royalties, then we need to find ways for Petronas to increase its revenue and profits so that it can contribute more to states like Sarawak, Sabah, Terengganu and Kelantan,” he said.
He also cautioned against political interference in the matter, citing the example of Indonesia’s state-owned oil giant Pertamina, which was crippled by decades of political meddling and corruption, including a US$11.9 billion fraud scandal involving rigged oil contracts.
Justice for Kelantan
Wan Fayhsal also reaffirmed the opposition’s commitment to securing oil royalties for Kelantan but stressed the need for creative solutions beyond just cash payments.
“The Kelantan state government has never wavered in its quest to seek justice over the oil royalties that have been denied to the Kelantanese people for years. This demand will continue to be pursued by all Kelantanese politicians, including myself.
“At the same time, we understand that this must be done carefully and not at the expense of Petronas’ growth. There are various ways to address this, not just through hard cash.
“For example, if Petronas and the federal government can provide more jobs for Kelantanese in lieu of oil royalties, that could be a potential solution,” he said.
He also suggested that dissatisfaction in Sarawak could be alleviated by the federal government addressing basic infrastructure issues more seriously.
“Maybe (Sarawak) believes that controlling their oil and gas resources would help them solve these problems better than relying on federal projects.
“If the federal government shows sincerity and resolves state-level issues properly, I don’t think the state government would be as concerned about fiscal decentralisation,” he said.
Sarawak currently receives a 5% oil royalty from Petronas.
Kelantan, on the other hand, does not qualify for royalties based on the federal government’s interpretation of offshore boundaries, which is premised on the Territorial Sea Act 2012.
Instead, Kelantan receives discretionary “wang ehsan” (courtesy) payments from the federal government for petroleum extracted beyond the state’s territorial waters.
