Solution to oil royalty dispute is simple, says Razaleigh

Harakahdaily,

09 August 2012

Aug 9: Former Finance minister Tengku Razaleigh Hamzah said the oil royalty dispute between PAS-led Kelantan state government and Petronas can be easily resolved and does not require Federal government's involvement.

The former chairman of the oil giant said the root cause of the oil royalty dispute was in Petronas’s failure to adhere to the Petroleum Development Act 1974 by paying 5 percent of royalty to Kelantan for oil extracted from its waters.

“So now, Petronas is responsible to solve the issue with the state government, as such there is no question about who is disputing as this is just the weakness on the part of Petronas for failing to pay the state government,” Razaleigh was quoted as saying by Sinar Harian.

The Gua Musang member of parliament was commenting on the setting up of a special panel by prime minister Najib Razak to look into demands for a share of the oil wealth involving Kelantan.

“To me, their task is very easy, just refer to the agreement, and it's done,” said Razaleigh.

PAS leaders have reacted with suspicion the announcement of the panel, describing it as BN's election ploy.

Opposition leader Anwar Ibrahim has said the oil royalty special committee was unnecessary, while Kelantan Menteri Besar Tuan Guru Nik Abdul Aziz Nik Mat said while his administration would still send representative to the panel as requested, insisted that the payment should not be delayed any longer.

“This is because the assets belong to Kelantan, no need for more discussion, it is right of the state," he added.