Kit Siang claims Tun Razak’s oil royalty pledge ignored

By Adib Zalkapli - The Malaysian Insider

KUALA LUMPUR, Feb 23 — DAP’s Lim Kit Siang accused the Najib administration today of ignoring the promise made 35 years ago by former Prime Minister Tun Abdul Razak Hussein in denying oil royalty payments to Kelantan.

“The full-page advertisements contain an important omission — the reply 35 years ago in Parliament by the then Prime Minister, Tun Razak to my question whether all states in Peninsular Malaysia, Sarawak and Sabah had signed agreements with Petronas for oil exploration along the coastline and what were the joint profits for the state,” said Lim (picture) in a statement today.

The DAP man was referring to advertisements placed in Bahasa Malaysia newspapers to justify the federal government’s refusal to pay oil royalty to Kelantan.

Quoting the Hansard dated Nov 12, 1975, Lim said Tun Razak had promised that all states “will receive five per cent of the value of petroleum found and extracted from each of the states, whether onshore or offshore, that is sold by Petronas or agencies or contractors.”

“Since I resurrected in Parliament in November last year Tun Razak’s categorical undertaking in Parliament 35 years ago on the five per cent oil royalty rights of the states, Cabinet Ministers had conspicuously avoided the subject — just like the full-page federal government advertisement explanations on Sunday,” said Lim.

Lim also challenged Prime Minister Datuk Seri Najib Razak to honour the promise made by his father and not to defend Tun Dr Mahathir Mohamad’s mistake of revoking the oil royalty payment for Terengganu in the year 2000.

“Is Datuk Seri Najib Razak, the sixth Prime Minister, the son of Razak the second Prime Minister or the heir of Tun Mahathir, the fourth Prime Minister on the oil royalty controversy?” asked Lim.

“Najib should demonstrate that he is Razak’s son and not Mahathir’s heir on this issue to restore justice to the states, whose fundamental state rights have suffered insidious erosion in the past few decades,” he added.

The Information, Communication and Culture Ministry took out full-page advertisements in Malay-language newspapers on Sunday, listing eight questions and answers to rebut Petronas founder Tengku Razaleigh Hamzah’s argument that Kelantan, as well as other states, are entitled to the five per cent oil royalty under the Petroleum Development Act 1974.

In late January, Tengku Razaleigh had spoken in support of Kelantan’s demand at a rally in Kota Baru. Yesterday he described the advertisements as an insult to the public’s intelligence.

The federal government however has promised a compassionate payment of RM20 million to Kelantan, which is expected to be channelled through Federal development agencies in the state.

Such a payment method was first introduced in the year 2000 during the period of the Mahathir Administration after Terengganu was captured by PAS in Election 1999.

Due to political pressure, the Terengganu government received some RM400 million in oil royalties last year, and is still demanding payment of another RM2.79 billion.