MEI 2025
Federal, State O&G Laws To Co-Exist, Joint Declaration Says
KUCHING, Thurs: The Federal Government and Sarawak Government in a landmark decision have jointly agreed that all relevant Sarawak laws relating to the distribution of gas within Sarawak shall coexist with federal laws and be respected by all concerned parties.
This is among the major common points of agreement agreed by both parties as contained in the document signed by both the Prime Minister of Malaysia and Premier of Sarawak yesterday at the Prime Minister’s Office in Putrajaya.
“All relevant Federal and Sarawak State laws relating to distribution of gas within the State of Sarawak shall coexist and be respected by all parties undertaking such activities in the State of Sarawak, including PETRONAS and PETROS,” the Agreement said. .
In this context, the Agreement also acknowledged that the Sarawak State Government has appointed PETROS as the gas aggregator pursuant to section 7A of the Distribution of Gas Ordinance (DGO) 2016 with effect from 1st of March 2025.
The Prime Minister, Dato’ Seri Anwar Ibrahim and Sarawak’s Premier, Datuk Patinggi Tan Sri Abang Haji Haji Johari bin Tun Abang Haji Openg in a press conference after the signing said the main spirit of the declaration is to ensure Petronas will continue to be the country’s premier oil company while recognising Petros’ increased role in Sarawak’s petroleum sector.
“Parties shall endeavour to continue to work together to detail out the framework for the benefit of the Nation, taking into consideration the aspirations of the State of Sarawak,” the declaration said.
The full detail of the declaration is as follows:
JOINT DECLARATION
In the interests of Federation of Malaysia, State of Sarawak and the oil and gas industry in Malaysia, we hereby jointly declare the following:
1. Federal and State Laws
1.1 All relevant Federal and Sarawak State laws relating to distribution of gas within the State of Sarawak shall coexist and be respected by all parties undertaking such activities in the State of Sarawak, including PETRONAS and PETROS.
1.2 PETRONAS will continue its functions, activities, responsibilities and obligations entrusted to PETRONAS in Malaysia, under the Petroleum Development Act 1974 (PDA 1974) and its regulations.
1.3 Parties shall endeavour to continue to work together to detail out the framework for the benefit of the Nation, taking into consideration the aspirations of the State of Sarawak.
2. PETROS as Gas Aggregator
2.1 The Sarawak State Government has appointed PETROS as the gas aggregator pursuant to section 7A of the GDO 2016 with effect from 1st of March 2025.
2.2 This appointment made pursuant to the executive authority of the State shall be respected by all parties undertaking the business of marketing, distribution and supply of gas to consumers in the State of Sarawak.
2.3 For agreements and arrangements pertaining to the supply and sale of natural gas to consumers in the State of Sarawak, the role of PETROS is in alignment with this declaration.
2.4 Any agreements and arrangements between PETRONAS and/or its subsidiaries with third parties for the purpose of LNG sales from upstream operations through to LNG exports to foreign parties shall remain unaffected.
3. Cooperation Framework
3.1 PETRONAS and PETROS shall enter into discussions for the purpose of expanding business cooperation for the State of Sarawak domestic gas needs, in the following areas:
(a) joint collaboration on projects for the implementation of the 1.2 Bscf/d in support of the Sarawak Gas Roadmap; and
(b) other green energy, hydrogen and power generation projects which may be implemented by both PETRONAS and PETROS, in line with the aspirations of the State of Sarawak to be the energy hub in the ASEAN region.
3.2 All discussions on collaborations must be subject to technical and commercial viability.
3.3 For the purpose of future projects in the State of Sarawak involving international partners, PETRONAS shall cooperate with PETROS.
4. All paragraphs shall be taken, read together and construed as an essential and integral part of this Declaration.