The former Umno leader said the national oil and gas company’s ongoing negotiations with Petroleum Sarawak Bhd (Petros) and the Sarawak government would be ineffective otherwise.

“Without clarity, how can negotiations proceed (meaningfully)? Both parties are speaking ‘different languages’,” he said, adding that negotiations must be anchored in a legal framework that binds both sides.

Khairy said Petronas had made the right decision in seeking clarification from the Federal Court, noting that the lack of legal clarity has already affected industry stakeholders and investors in the gas sector.

“Many investors now don’t know who to talk to regarding the development of the gas industry in Sarawak, whether to talk to Petronas or to Petros,” he said on the latest episode of the Keluar Sekejap podcast that aired yesterday.

A 2023 amendment to Sarawak’s Distribution of Gas Ordinance 2016 requires Petronas to secure gas distribution licences for its operations in the state, putting the enactment at odds with the Petroleum Development Act 1974, which vests in Petronas exclusive rights to oil and gas resources nationwide.

The Federal Court has set March 16 to decide on Petronas’s motion for leave to pursue the application.

Petronas had said its decision to file the motion followed a series of dialogues and negotiations held since 2024 with Petros, as well as both federal and state authorities.

Petronas and Petros, along with federal and state authorities, have long been locked in a dispute over gas distribution rights in Sarawak.

Khairy warned that the dispute should not be driven by political narratives, including sensitivities linked to the Malaysia Agreement 1963, saying that the best way forward is through legal interpretation by the court.

He described the referral as a “constitutional and civilised mechanism” for resolving complex legal questions and expressed hope that the court’s ruling would strike a balance between federal and state interests.