Oil money not prerogative of federal government, says Ku Li

(The Edge) – Former Petronas chairman Tengku Razaleigh Hamzah today stressed that the federal government was not at liberty to “distribute as largess” the proceeds from oil and gas production because such gains rightfully belonged to the people.

Razaleigh told reporters that there was “no such thing” as wang ihsan or ‘compassionate payments’, referring to Prime Minister Datuk Seri Najib Tun Razak’s announcement on Nov 3 that the federal government would pay wang ihsan to the Kelantan state government.

“Oil is not for the federal government to distribute as largess. The government can distribute from the revenue collected from taxes, and that is the prerogative of the federal government, but when it comes to this, it is the right of the people,” Razaleigh said.

Asked if Najib was wrong in the announcement, the Umno veteran smiled and said, “Well, that’s up to you to interpret”.

Razaleigh (Gua Musang – BN) added that the people had constitutional rights over proceeds for oil and gas found onshore or offshore, based on the agreements signed between Petronas and the states.

The long-serving member of parliament (MP), who is also known as Ku Li, revealed that Pakatan Rakyat (PR) had invited him to head a parliamentary caucus on the “hot subject” of oil royalties with a view of arriving at an “amicable solution to the problem”.

This was likely discussed during Razaleigh’s meeting with PR leader Datuk Seri Anwar Ibrahim (Permatang Pauh – PKR), PAS vice-president Salahuddin Ayub (Kubang Kerian – PAS) and PKR election director Saifuddin Nasution (Machang – PKR).

The half-hour meeting took place at the MPs lounge in parliament this afternoon.

However, Razaleigh said he had not given an answer, and declined to state when he would announce his decisions.

“I’ll be following the developments to see if I can contribute because after all I was involved in the oil business starting with the formation with Petronas, negotiation with the states, drafting of the laws,” he said.

Razaleigh, who is founding chairman and chief executive of Petronas from 1974, was involved in negotiations between the national oil corporation and the various states.

The former finance minister also played a key role in designing the Petroleum Development Act 1974.

Razaleigh had been speaking up in support of the Terengganu and Kelantan’s rights to obtain five percent royalty for petroleum, whether found offshore and onshore, rather than mere compassionate payment.