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Reader’s Opinion
Is It True That There was Nothing in MA63 on O&G ownership, regulations, as stated by Azalina
Dato’ Azalina Othman Said delivered such answer to a Parliamentary Question.
“The Malaysia Agreement 1963 (MA63) does not contain any provision concerning the ownership or regulation of oil and gas resources, says law and institutional reform minister Azalina Othman Said.
Azalina said MA63 also does not assign the roles of petroleum entities like Petronas or Sarawak’s sole gas aggregator, Petroleum Sarawak Bhd (Petros).
The MA63 is the foundational document that sets the terms for the formation of Malaysia, including the rights and autonomy of Sabah and Sarawak in certain areas.
What could she possibly mean by such answer? Was it a mere interpretation on the literal reading on the provision of the MA63 as against grasping the spirit and intent envisaged by the Parties as expressly and implied under the said document?
If it is the former, it portrays how lightly she grasped the question that has now found it’s way at the Federal Court. Surely the Federal Court would have not revert to such flimsy conclusion.
By contrast, the content of 11th Memorandum of the MA63 relating to Financial and Tariffs and 20th Memorandum relating to Land, Forestry, Local Government and other matters, were clearly subsequently pursued and eventually provided in Malaysia’s Federal Constitution.
In as much as was pointed out by Azalina that the Petroleum Development Act was rightfully legislated by Parliament pursuant to the Federal List in the 9th Schedule Paragraph 11(c) of the Federal Constitution. It should be noted too that under the State List at paragraph 2 (c), State shall have control over land matters in respect of ‘permits and licenses for prospecting for mines, mining leases and certificates’ and to impose fees and tariffs.
Will Azalina only comes to terms that the MA63 must have provisions specifically on O&G to qualify that it in fact touches on the said matter?
It should be noted that Article 110(3B) empowers that the Parliament may by law provide for prohibiting or restrictiong, in, or except in, such cases as may be provided by or under the law, the levying of royalties on or similar charges in respect of minerals (whether under a lease or other instrument was made or the enactment passed before or after the coming into operation of this Clause).
However, Article 112C(4)(b) provides that Clause 3B) of Article 110 shall not authorize the Parliament to prohibit the levying of royalties on any mineral by the State or to restrict the royalties that may be so levied in any case so that the State is not entitled to receive royalty amounting to ten per cent (10%) ad valorem (calculated as for export duty).
Surely these are the very provisions that are related and culminated from the 11th and 20th Memorandum of the MA63. Does that shed any lights on the outstanding dispute between Petros and Petronas?
Azalina should be careful with her choices of words rather than making passing statement since MA63 were the founding agreement for the State of Sabah and Sarawak to find their way into the Federation of Malaysia.
(Reader’s Opinion pieces reflect the views of the author and do not necessarily represent the position of this publication)
