Petronas, Sarawak ink landmark settlement deal

Under this landmark commercial settlement agreement, both Petronas and the state government have agreed to establish a consultative framework to enhance collaboration through a structured and formalised avenue comprising a joint coordination committee and an annual strategic dialogue.

KUALA LUMPUR: Petroliam Nasional Bhd (Petronas) and the Sarawak state government today signed a commercial settlement agreement on the issues of the state’s sales tax and oil mining laws.

Petronas president and group chief executive officer Tengku Muhammad Taufik Tengku Aziz said the commercial settlement agreement would establish a framework between the national oil company and the state government that would see Sarawak more actively involved in its onshore oil and gas activities through Petroleum Sarawak Bhd (PETROS).

"Under this landmark commercial settlement agreement, both Petronas and the state government have agreed to establish a consultative framework to enhance collaboration through a structured and formalised avenue comprising a joint coordination committee and an annual strategic dialogue.

"These platforms will be co-chaired between Datuk Patinggi Dr Abang Haji Abdul Rahman Zohari, Chief Minister of Sarawak and Tan Sri Ahmad Nizam Salleh, chairman of Petronas’ board," he said at the signing ceremony today.

The signing ceremony was witnessed by Prime Minister Tan Sri Muhyiddin Yassin, Sarawak Chief Minister Datuk Patinggi Abang Johari Tun Openg and Finance Minister Tengku Datuk Seri Zafrul Aziz. - Bernama

Joint statement by state government of Sarawak and Petronas

KUALA LUMPUR, Dec 7 (Bernama) -- The Sarawak State Government and PETRONAS are pleased to announce the conclusion of negotiations, facilitated by the Ministry of Finance, on a commercial settlement after having resolved their differences over the imposition of State Sales Tax on petroleum products as well as oil and gas matters.

The commercial settlement agreement (Agreement), which was executed on 7 December 2020, witnessed by both the Prime Minister and the Chief Minister of Sarawak, amongst others provides Sarawak with a greater share of revenues from oil and gas found and produced in the State. It also provides for a more active involvement by the State in the oil and gas industry through the management of onshore oil and gas resources by PETROS and investment by PETROS in the upstream ventures in offshore areas.

Both the Sarawak State Government and PETRONAS, continuing its current role as Malaysia’s national oil company, remain committed to working together to create and maintain a stable, conducive business and investment environment for the sustainable growth of the oil and gas industry, both upstream and downstream in Sarawak. Towards this objective, the Agreement provides for a consultative framework whereby both Parties will be able to jointly discuss and deliberate on matters of importance to the oil and gas industry including those which affect the interests of the State.

Datuk Jaul Samion

Sarawak State Secretary

Tengku Muhammad Taufik

President & Group CEO