Tuesday, June 17, 2008


Sabah leader asks Petronas to make its accounts transparent


Another Barisan Nasional (BN) component party leader, Donald Datuk Peter Mojuntin, has called on Petronas to make its accounts transparent so as to explain the reason for the fuel price hike or subsidy reduction in the Country. Mojuntin, who is the Assistant Resource Development and Information Technology Minister and United Pasokmomogun Kadazandusun Murut Organization (UPKO) Youth Chief, said that the people have the right to know the reason for the fuel price hike and subsidy reduction despite the fact that Petronas is reaping a profit from the global price of crude oil. “I wholeheartedly agree with Umno Youth Deputy Chief Khairy Jamaluddin’s call for Petronas to be transparent with its accounts so as to answer questions why the national oil corporation was unable to absorb the high cost of fuel with its profits,” Mojuntin, who is also the Moyog Assemblyman, said when met during his Pesta Kaamatan rounds on Sunday. According to him, Petronas produces 650,000 barrels of crude oil a day and of the total, about 400,000 barrels are used locally daily which leaves 250,000 barrels to be exported. Though Petronas has never divulged publicly the cost of producing one barrel of crude oil, it is estimated to be in the region of USD12 whilst the world price of crude oil is hovering at USD136 per barrel. “It does not take a mathematical genius to calculate the gross profit which will be about USD30 million per day. Where does this profit go to?” he asked. “For Sabah, being the biggest oil and gas producer in the Country, the question becomes more pertinent as according to Petronas itself, Sabah has 1.4 billion barrels of crude oil and 7.7 trillion (sfc) standard cubic feet of gas in reserve. “Bearing all this in mind, the rakyat find it very hard to understand why they are I burdened with high fuel price,” Mojuntin said. According to him further, since Sabah thus far only benefits from the five percent oil royalty, certain questions have to be asked. “Is the five percent from the gross or nett profit of oil production? Also equally pertinent is the question if the five percent royalty includes the production of gas?” he questioned. “Is Sabah getting five percent of all oil production in its waters or only for oil fields within the 20- kilometre radius from its shores? All these will have to be explained and Petronas must cease to blind side the rakyat, banking on the fact that the rakyat have limited understanding of the oil and gas industry,” he said. Mojuntin stressed that apart from the illegal immigrants issue, people in Sabah are highly sensitive when it comes to matters related to the oil and gas production in the State. On May 31, Prime Minister Datuk Seri Abdullah Ahmad Badawi announced the scrapping of the Kimanis-Bintulu gas pipeline project which was received with great relief and appreciation, he said. “I think the Prime Minister recognises the fact that building a petrochemical complex in Kimanis would be more economically beneficial to Sabah in the long run and the existence of a thriving oil and gas industry in Kimanis would be an anchor to ensure the success of the Sabah Development Corridor. “However despite the Prime Minister’s announcement, it is understood that the Petronas gas pipeline team is now in Sabah. This seems to indicate that the project is still on,” said Mojuntin.