Petronas to Retain National Authority After Sarawak Gas Deal

Malaysian state energy firm Petroliam Nasional Berhad (Petronas) will retain its national authority over oil and gas even as Petroleum Sarawak Berhad (Petros) takes control of gas distribution in Sarawak state, Prime Minister Anwar Ibrahim said.

Anwar said while Petros had authority as a gas aggregator, both it and the Sarawak government agreed it would not interfere with Petronas' role and operations under the Petroleum Development Act 1974, state news agency Bernama reported.

"The PDA 1974 remains the overarching framework for governance in Malaysia's oil and gas industry. All existing agreements are intact, as disturbing them would complicate relationships with major international companies. This has been mutually accepted," Anwar was quoted as saying.

Anwar said any gas-related projects in energy-rich Sarawak, particularly those requiring substantial financing, would have to involve Petronas, Bernama reported.

Sarawak, on Borneo island, has long sought greater control of its natural resources. Last February it appointed Petros to procure, distribute, supply and sell all natural gas produced in the state to downstream buyers.

A deadlock in negotiations last year had sparked some industry worries over the potential impact on Petronas, a major contributor to federal coffers, and on energy activities in Sarawak, which holds over 60% of