“PM and Umno MP Confirms STAR/UBF Stand”

“The Prime Minister’s statement on the oil payment while in Sipitang and the concerns voiced by the Kota Belud Member of Parliament on oil payment and development funds proves and re-affirms the stand by UBF and STAR Sabah that representatives of Peninsular parties and Sabah BN components cannot fight for the rights of Sabah” stated Datuk Dr. Jeffrey Kitingan, STAR Sabah Chairman.

The PM’s explanation on the increase of oil payment totally missed the point.

What if Sabah and Sarawak did not agree to form Malaysia in 1963 and today Malaysia (or Malaya) is not entitled to the oil revenues from Sabah and Sarawak?  What then for Peninsular states’ development funds without the oil revenues from Sabah and Sarawak?

“The oil cash payment from Petronas for Sabah’s oil and development funds from the Federal Government for Sabah are separate and distinct issues and not inter-related.”

The basis for the cash payment for oil is clear-cut.  The oil belongs to Sabah as owner where the oil resources are found.  Non-oil producing States are not entitled to any such oil cash payment.

It should be remembered that before the formation of Malaysia in 1963, Sarawak received 100% of oil revenues for their oil.

Similarly, Brunei which opted out at the last hour in not forming Malaysia continues to receive 100% of its oil revenue.  As a result, all Bruneians enjoy the wealth and benefits generated by such oil revenues.

Even Acheh Province in Indonesia receives 70% of its oil revenue.  There is no reason for Sabah to be restricted to 5% of its oil revenue.

In fact, it is wrong to state that Sabah should be given a higher percentage of its oil revenue.  As the oil is found in Sabah, it should be Sabah that receives the oil revenue and give or contribute a portion to Petronas or the Federal Government.

In all fairness and equitable basis, the bulk of the oil revenue should be retained by Sabah not just 5%.

It is not surprising that Sabah is the poorest State given that it has “lost” 95% of its oil revenue to Petronas, some RM15.0 billion a year.

The opinions of some observers that Petronas cannot afford a higher payment of the oil revenue is without any basis.

For the financial year ending 31 March 2010, Petronas made a gross profit of RM82.4 billion and RM90.5 billion for the financial year ending 31 March 2011.

For the half-year ending 30 September 2011, Petronas posted a gross profit of RM57.594 billion compared to a gross profit of RM39.597 billion for the corresponding period ending 30 September 2010.  If the performance continues until 31 March 2011, Petronas would make a record gross profit of well over RM110 billion.

For the financial year ending 31 March 2010 and 31 March 2011, apart from federal income tax, Petronas paid out a RM30.0 billion each year in dividend payment to the Federal Government.

Under STAR’s Petroleum Masterplan, STAR will seek a review of the Oil Agreement and seek at least 50% of the oil revenues for Sabah which is estimated to be RM7.75 billion.

The PM’s statement that any increase in oil payments for Sabah needs to be viewed in the bigger context of reduced development allocations for Sabah runs smack of a colonial attitude in the treatment of Sabah and the unfair seizure of Sabah’s oil.

By requesting Pakatan Rakyat to assure there would be no reduction in development funds for Sabah with the proposed increase in oil payment to Sabah, the MP for Kota Belud clearly shows that as a MP representing Sabah he is unable to fight for Sabah’s interests and at the same time acknowledging a higher oil payment will be beneficial to Sabah and Sabahans.

Instead of voicing his concerns, as a member of the ruling Federal Government, the said MP should be seeking an increase of the oil payment and an increase in development funds for the benefit of Sabah and Sabahans.

As regards development funds, regardless of whether Sabah is an oil producing State or not, Sabah is entitled to its fair share of the federal development funds.  The development funds are not and should not be linked to oil payments.

As a matter of fact, Sabah has always been deprived of its fair share of the development funds which are monopolized by the Peninsular States.

For instance, funds for road infrastructure is insufficient for Sabah roads.  In his own constituency, the trunk road from Kota Belud to Kota Marudu is pathetic with unrepaired damaged bridges for years and many sections not properly tarred and not properly maintained.

The Kota Belud-Kota Marudu is not only an important trunk road in northern Sabah but also the only route where tens of thousands of foreign tourists use every year to visit the tourist spot “The Tip of Borneo.”

To top it all, the adjacent constituency is represented by a Federal Minister from Sabah.

As we have said all along, representatives of Peninsular parties and Sabah BN components need to be changed as they cannot be depended upon to safeguard the interests and rights of Sabah and Sabahans.

If the people of Sabah continue to elect representatives that do not have the political will to ask for higher oil payments and more funds for development let alone fight for Sabah’s rights and interests, Sabah will remain the poorest with lack of proper infrastructure, clean water and other amenities.

Problems for Sabah will only increase with the attitude of federal leaders in treating Sabah as a far-flung “colony” across the South China Sea.

If the federal leaders do not treat Sabah as a “colony”, they should even consider giving shares in Petronas to oil producing States like Terengganu, Kelantan, Sabah and Sarawak.  After all, Petronas started from zero and that it is what it is today, a global giant, its all due to the oil revenues from the oil producing States.

The RM500.00 BR1M is no adequate compensation or remedy.

Save Sabah, vote out the existing Government.

Datuk Dr. Jeffrey Kitingan, Chairman, STAR Sabah