The battle for O&G in the continental shelf off Sarawak's shores

Free Malaysia Today

FMT explores the validity of Sarawak’s claim to sole rights to energy resources found up to 200 nautical miles from the edge of its territorial waters.   *The footage in this video is sourced from various social media platforms for educational and non-commercial purposes only, with all rights remaining with their respective owners.   Read More:  https://www.freemalaysiatoday.com/category/nation/2024/11/12/the-battle-for-og-in-the-continental-shelf-of-sarawaks-shores/   Laporan Lanjut:  https://www.freemalaysiatoday.com/category/bahasa/tempatan/2024/11/12/pertikaian-minyak-dan-gas-di-pelantar-benua-pesisir-sarawak/   Free Malaysia Today is an independent, bi-lingual news portal with a focus on Malaysian current affairs.    Subscribe to our channel - http://bit.ly/2Qo08ry   ------------------------------------------------------------------------------------------------------------------------------------------------------  Check us out at https://www.freemalaysiatoday.com  Follow FMT on Facebook: https://bit.ly/49JJoo5  Follow FMT on Dailymotion: https://bit.ly/2WGITHM  Follow FMT on X: https://bit.ly/48zARSW  Follow FMT on Instagram: https://bit.ly/48Cq76h  Follow FMT on TikTok : https://bit.ly/3uKuQFp  Follow FMT Berita on TikTok: https://bit.ly/48vpnQG  Follow FMT Telegram - https://bit.ly/42VyzMX  Follow FMT LinkedIn - https://bit.ly/42YytEb  Follow FMT Lifestyle on Instagram: https://bit.ly/42WrsUj  Follow FMT on WhatsApp: https://bit.ly/49GMbxW  ------------------------------------------------------------------------------------------------------------------------------------------------------  Download FMT News App:  Google Play – http://bit.ly/2YSuV46  App Store – https://apple.co/2HNH7gZ  Huawei AppGallery - https://bit.ly/2D2OpNP   #FMTNews #Sarawak #Petronas #OilAndGas #ContinentalShelf

Transcript

00:00The OMO, the Oil Mining Ordinance, has been around since 1958.

00:07It has not been repealed,

00:09whereas the law still exists where Sarawak has a little bit of power

00:16in terms of mining.

00:18And oil and gas is a mining industry.

00:24The state of Sarawak in Malaysia has been embroiled in a long-standing dispute with Petronas,

00:29the national oil company.

00:31At the heart of this debate is which of them owns the rights to oil and gas resources

00:36found on the continental shelf off Sarawak's coast.

00:41The Queen's Council in 1954 has drawn up the Sarawak boundary.

00:47So our boundary is still within the continental shelf.

00:51The issue is rooted both in Sarawak's unique history and in the Petroleum Development Act in 1974,

01:04which grants Petronas exclusive ownership of all onshore and offshore petroleum resources throughout Malaysia.

01:11However, Sarawak also claims a right to resources off its coast,

01:15tracing its right to the state's Oil and Mining Ordinance of 1958

01:19and a colonial order that predates it.

01:22The state asserts that in 1954,

01:25an order by Queen Elizabeth II expanded Sarawak's boundaries to include the continental shelf.

01:32According to Sarawak, an extension of up to 200 nautical miles from its boundaries

01:37existed when Malaysia was formed in 1963.

01:42This disputed area in the South China Sea is rich in oil and gas.

01:46It holds some 60% of Malaysia's known reserves

01:49and is essential to the country's production of liquefied natural gas,

01:53which forms a significant part of the national economy.

01:57Recently, Sarawak has demanded a greater share of the revenue derived from these resources.

02:03The state argues that the 5% royalty payment prescribed by an agreement entered with Petronas

02:08is not fair compensation given the scale and value of the resources within its boundaries.

02:15Former Petronas chairman Tunku Razali Hamzah disagrees with Sarawak's stance,

02:19saying the matter was not even discussed when the 1963 Malaysia agreement was drawn up.

02:24Tunku Razali argues that Sarawak should honour its royalty agreement with Petronas.

02:30All that we want to make sure that there is no quarrel between the states and the federal government.

02:37So we make sure that the payment is the same for everybody,

02:42whether you have oil or you don't have oil.

02:44But if you find oil, we'll give you 5% of the value of the oil.

02:49And who formulated this?

02:52It was Raman Yacob after he met the cabinet in Sarawak.

02:57And we discussed that with all the state governments after referring to the federal cabinet

03:04and they agreed.

03:05That is the best way to go.

03:08Raman Yacob negotiated and agreed that 5% goes to Sarawak.

03:16I mean, you can't go back and forth, you know.

03:19An agreement is an agreement, isn't it?

03:22The Territorial Sea Act 2012 was introduced to comply with the United Nations Convention

03:27on the Law of the Sea, which Malaysia joined in 1982.

03:31UNCLOS defines a 200 nautical mile limit as applicable to a sovereign nation,

03:36in this case Malaysia, not its individual states.

03:40Sarawak also relies on the federal constitution for support.

04:00Sarawak contends that neither of these conditions have been met,

04:03rendering any changes to its boundaries unconstitutional.

04:07Maritime lawyer Liu Teck Huat, however, offers a different perspective.

04:12He suggests that the term continental shelf remained undefined in 1954.

04:34But the 200 nautical mile length is not specifically stated in the Order in Council itself.

04:41According to Liu, the term continental shelf was defined in the United Nations Convention

04:47on the Law of the Sea, which Malaysia inked in 1982 and ratified four years later.

05:04The Petroleum Development Act of 1974 and the Territorial Sea Act 2012 are good laws.

05:12Clearly, multiple issues arise touching on historical boundaries, state rights and federal authority.

05:18Unless determined with finality by the courts,

05:21any dispute between Petronas and Sarawak will likely remain unresolved.

05:26Perhaps the solution lies in a fair long-term arrangement,

05:29respecting, on the one hand, the right of all Malaysians to shared resources,

05:33and, on the other, Sarawak's own rights,

05:36premised on its history as well as current and future needs.

05:42Danish Raja Reza, FMT News.

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