Sabah looks beyond royalties to boost oil gains

The Star

13 hours ago

KOTA KINABALU: Sabah is not banking solely on higher oil royalties to increase its revenue.
State Finance Minister Datuk Seri Masidi Manjun said they are working towards building a vibrant oil and gas ecosystem that will directly benefit Sabahans.
He noted that while royalties remain important, there are more sustainable and inclusive ways for the state to benefit from its oil and gas resources, with the primary focus on industry development that fosters local participation and job creation.
'Royalty is not the only means of getting more oil money.
'If it is just royalty, the money goes straight into the government's consolidated fund. But if we create a vibrant industry in Sabah, many local companies will benefit, and that will lead to jobs and direct income for our people,' Masidi explained to the media during an event on Wednesday evening (July 2).
He also stressed that efforts are ongoing to improve the state's tax governance through amendments to the State Sales Tax (CJN) Ordinance.
'These changes are not just routine. We want the provisions to be crystal clear so there is no ambiguity. Taxpayers should also be given fair room to appeal if they are unhappy,' he said.
Masidi added that the CJN amendment is also about strengthening the role of tax officers and ensuring everyone involved understands their responsibilities to avoid confusion.
'In short, we are improving execution. It is about accountability and clarity, not just policy.'
On another matter, Masidi confirmed that the long-awaited meeting on Sabah's 40% revenue entitlement under the Malaysia Agreement 1963 (MA63) has been rescheduled to mid-July after the originally planned date of June 30 was postponed.
'The Chief Minister had sent two letters in June, one to remind about the committee, and another offering for Sabah to host the meeting. The delay was due to scheduling issues, but we are now looking at July 14 or 15,' he said.
On developments in the oil and gas sector, Masidi revealed that exploration activity is intensifying in Sabah's east coast, particularly in the northeast region near Sandakan.
'ConocoPhillips is one of the companies involved in active exploration there. I believe another announcement will be made soon,' he said.
He clarified that the activity is not within the environmentally sensitive Coral Triangle area.
'This is in the Padang area, not the Coral Triangle,' he said, in response to concerns raised by environmental groups.
Touching on recent discussions surrounding the Ambalat oil block, Masidi urged all parties to refrain from speculation.
'The Prime Minister Datuk Seri Anwar Ibrahim merely made a statement. To me, it is better we get the facts right before commenting. Let's seek clarification from the federal government,' he said.
He added that the state government is not aware of any company being involved in Ambalat at the moment and stressed that it is important for members of parliament to raise the issue in Parliament if needed.