Ku Li: All states have a right to oil royalty

(The Star) – Former Finance Minister Tengku Razaleigh Hamzah has weighed in on the oil royalty debate, saying that all oil-producing states including Kelantan had a right to oil royalty.

Razaleigh’s view clearly opposed that of Minister in the Prime Minister’s Department Datuk Seri Nazri Aziz, who had insisted on Tuesday that Kelantan had no right to ask for oil royalty as no petroleum was produced in the state’s waters within three nautical miles of the coastal line.

“It is a constitutional right of the people, whether is it found on shore or off shore. I think the agreement that was signed between the states and Petronas assures that the states where oil is found, whether on shore or off shore, will benefit from such a find,” he told reporters at the Parliament lobby on Wednesday.

The Federal Government had labelled the oil payout to Kelantan as a “goodwill payment,” which the Opposition objected to, saying that money was a right and not a goodwill payment.

“There is no such thing as wang ehsan (goodwill payment) because oil is the right of the people and it’s not for the Federal Government to distribute as a largess.

“The Government can distribute such funds from the revenue collected from taxes and that is its prerogative; but when it comes to this, it is the right of the people.

“That’s why I feel inclined to say my piece because I was involved from the beginning and I know the intention of why we had the agreement with the states,” he said.

Razaleigh, who was Finance Minister and Petronas chairman when the Petroleum Development Act 1974 came into force, held a short discussion with Opposition leader Datuk Seri Anwar Ibrahim, PAS vice-president Salahuddin Ayub, PKR strategic director Tian Chua and election director Saifuddin Nasution on the issue at the MPs’ lounge.

Razaleigh said they wanted to form a caucus on the matter and wanted him to lead it, to which he said he would consider it.

”I will be following the development to see if I can contribute, because after all I was involved in the oil business, starting with formation of Petronas and negotiation with the states and the drafting of the laws,” he noted.