KUCHING: The Sarawak government has denied claims in a Reuters news report that it will drop its demand for the oil royalty to be increased to 20%.
The Chief Minister's office said the state government's current negotiations with the Federal Government on oil and gas matters were based on the 20% royalty demand.
"This office wishes to clarify that the Sarawak government has not dropped the demand.
"The article is misleading and vexatious in intent," it said, referring to the Reuters report published on Thursday (Oct 31).
The report said Sarawak would drop its demand for 20% oil royalty and would instead push for production-sharing and other agreement with Petronas.
It said the demand from Sarawak and Sabah for 20% royalty would cost Petronas up to US$7bil (RM29bil) a year.
Last month, Prime Minister Tun Dr Mahathir Mohamad said it was "really not workable" to increase the royalty to 20% as promised in Pakatan Harapan's election manifesto as this could "kill" Petronas.
He said the Federal Government was "trying to work out how we can give (Sabah and Sarawak) more money without undermining Petronas' own strength."
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