Armizan said Sabah’s push for greater participation in the O&G industry began after a meeting between chief minister Hajiji Noor and Petronas leadership in August 2021, which he also attended alongside state finance minister Masidi Manjun.
The Papar MP said the discussion marked the first time Petronas had received a written framework of Sabah’s aspirations and demands, paving the way for the signing of a commercial collaboration agreement (CCA) on Dec 7, 2021.
He said the agreement has since expanded Sabah’s involvement in the O&G industry beyond royalty and sales tax to include equity stakes in O&G exploration, as well as greater participation by local contractors, which now number more than 1,000.
“Through the CCA, Sabah is pursuing more valuable and meaningful cooperation with Petronas based on the principles of greater say, greater participation, and greater revenue sharing,” he said in a statement.
“We reject allegations that the aspirations and demands of states, including Sabah, will undermine Petronas, which is seen as the golden goose
“Our aspiration, after more than 50 years, is that it is time for Petronas to help give rise to a new golden goose owned by Sabah itself, that is SMJ Energy Sdn Bhd.”
State-owned SMJ Energy has been tasked with coordinating Sabah’s role across the entire O&G value chain.
Speaking at a conference in Tanjung Aru, Kota Kinabalu, on Thursday, Hajiji said the high O&G revenue enjoyed by Sabah is due to the state government’s direct negotiation with the Petronas management and its explanation of what the state wants.
Through the agreement, SMJ Energy has acquired equity in multiple ventures, including a 50% stake in the Samarang production-sharing contract, which consists of seven O&G producing fields off the coast of Sabah.
SMJ Energy has also acquired a 25% stake in the Sabah Ammonia Urea (Samur) petrochemical complex and another 25% stake in a nearshore floating liquefied natural gas (ZLNG) facility in Sipitang.
About half of the state government’s revenue of RM6.7 billion in 2023 was derived from oil and gas activities in the form of cash payment, and sales and services tax.