Petronas’ little Christmas present for Sabah

Petronas, the 13th most profitable company in the world, is setting up a Petrosains Centre in Kota Kinabalu similar to but smaller than the popular Petrosains Discovery Centre, in KLCC in Kuala Lumpur.

Opening soon on the ground floor of the Sabah State Library on Jalan Tasik after December 15, it is a Christmas present for Sabah.

This “gift” comes after years of complaints by locals about the transparency of Petronas scholarships and job opportunities in return for the significant amount of crude oil and natural gas Sabah contributes to Petronas since its incorporation via the Petroleum Development Act 1974.

Many locals want Petronas to provide cheaper petroleum to East Malaysian public transportation companies, especially shipping companies, to offset the pricing disadvantages of the cabotage policy so that the prices of goods imported into East Malaysia can be cheaper.

Prices of houses can also be lowered if transportation costs are not so high
that they hike up the prices of cement and other building materials.

With such a wealth of a resource, East Malaysia should have achieved a
‘high-income states’ status much earlier in history.

With more than 30 over years of oil production under its belt, Malaysia is more than able to qualify as a developed nation, which is mostly quantified by per capita income.

Petronas is a major property player in Malaysia as seen in its role in the KLCC and Putrajaya developments aside from its core business in oil and gas.

From 2012, through its development role in the oil and gas sector in Sabah with its plants in Kimanis and Sipitang, Petronas is expected to contribute much to the Sabah economy and boost the property sector with rental income and house sales as the number of workers increases and settles down in Sabah.

This downstream development could have happened much earlier, as states such as
Negri Sembilan, Melaka and Johor with no oil or gas wells were developed with refineries, processing plants and depots.

Section 6(1) of the Petroleum Development Act 1974 gives the Prime
Minister full authority in determining downstream operations states:
Notwithstanding the provisions of any other written law, no business of
processing or refining of petroleum or manufacturing of petro-chemical
products from petroleum may be carried out by any person other than
Petronas unless there is in respect of any such business a permission
given by the Prime Minister.

Many Sabahans have felt that this has been unfair to Sabah for many years, as the
Umno Prime Minister accorded more priority for Umno-run states in Peninsula Malaysia until recently as Umno became well entrenched in Sabah with many new naturalised Muslim citizens from Indonesia and the Philippines as ‘natives’ and only now the state is allowed the opportunity to develop its true potential in the oil and gas sector.