Sarawak-Putrajaya O&G dispute a significant constitutional test, says PBB man

KUCHING (Feb 27): The ongoing dispute between the federal and Sarawak governments over oil and gas rights is shaping up to be one of the most significant constitutional tests since the formation of Malaysia, said Parti Pesaka Bumiputera Bersatu (PBB) supreme council member Wejok Tomik.

Wejok, who is a lawyer, argued that the matter transcends commercial interests and strikes at the heart of federalism and the safeguards agreed upon under the Malaysia Agreement 1963 (MA63).

He maintained that Sarawak entered Malaysia in 1963 as an equal founding partner with constitutionally-protected control over land and natural resources, and not as a subordinate state subject to unilateral federal control.

Wejok traced Sarawak’s position to pre-Malaysia Day arrangements, noting that the state’s territorial boundaries were defined under the Sarawak (Alteration of Boundaries) Order in Council 1954, which extended to the continental shelf.

“Oil and gas activities were governed by the Oil Mining Ordinance (OMO) 1958, vesting licensing and regulatory authority in the Sarawak government.

“The enactment of the Petroleum Development Act (PDA) 1974 marked a fundamental shift by vesting the entire ownership of petroleum resources in Petronas,” he said in a statement.

He contended that the PDA was not part of MA63 as it was introduced during Emergency-era political conditions and was never formally adopted by the Sarawak Legislative Assembly (DUN), raising questions about its applicability in the state.

Wejok said at the centre of the dispute are constitutional provisions protecting state territories and legislative powers.

He pointed to Article 1(3) and Article 2(b) of the Federal Constitution which safeguard state boundaries, as well as Article 95D which provides that certain federal laws relating to land and local government do not apply to Sarawak unless adopted by the DUN.

He also argued that the Territorial Sea Act (TSA) 2012, which limits state waters to three nautical miles, was passed without Sarawak’s consent and is therefore unconstitutional as applied to the state.

“Given that petroleum extraction occurs in or under land, including seabed and subsoil, the PDA cannot override the OMO which remains valid as it has never been repealed by the Sarawak legislature.

Wejok said following Sarawak’s move in 2024 to appoint Petroleum Sarawak Berhad (Petros) as the sole gas aggregator under the Distribution of Gas Ordinance (DGO) 2016, all gas produced in Sarawak must be sold to Petros, which determines domestic allocation and exports.

He described the move as a structural shift that reduces Petronas’ trading dominance and restores planning authority over gas utilisation to the Sarawak government, with the state aiming to increase domestic gas usage from about 6 per cent to 30 per cent by 2030 to support industrialisation.

Wejok stressed that Sarawak’s case is grounded in constitutional continuity rather than secessionist intent.

“This is not about greed or separation. It is about whether the constitutional guarantees given in 1963 can be overridden by later federal statutes enacted without state consent.”

He called for a “negotiated reset” between Putrajaya and Sarawak, including clearer revenue-sharing mechanisms, recognition of pre-1963 territorial boundaries, restoration of parliamentary balance, and defined complementary roles for Petronas and Petros.

“True unity is built on justice, not coercion. True federalism is built on consent, not control,” he said, urging dialogue over prolonged litigation in resolving the impasse.