Sarawak State to Sue Petronas over Sales Tax

Thursday, June 11, 2020

Malaysia's energy-rich Sarawak state will pursue legal proceedings against national oil company Petronas over the non-payment of sales tax, backtracking on a settlement agreement reached last month, national news agency Bernama reported.

Petronas and Sarawak had reached a settlement in May, with the energy company agreeing to pay 2 billion ringgit ($470 million) in back sales taxes, and Sarawak agreeing to drop a civil lawsuit it filed last year to seek the funds.

A Sarawak state body said on Wednesday, though, that the state would continue its civil case against Petronas if no final decision was reached through further negotiations on the tax payments with the company, Bernama reported.

The joint statement issued by Petronas and the state in May regarding the settlement was not a "formal agreement", Bernama reported, citing Amar Mohd Asfia Awang Nassar, the chairman of the Sarawak state assembly consultative committee.

"It was a statement based on discussions back then, and today, I am making it clear that we will continue our civil case against Petronas," said Amar Mohd Asfia.

Petronas did not immediately respond to questions from Reuters on the reported comments of the state official.

Sarawak took Petronas to court in November, saying the national oil company was the only energy company operating in the state that had not paid the 5% state sales tax that was imposed on Jan. 1, 2019.

Malaysia's Sarawak and Sabah states - both located on Borneo island and holding much of the nation's oil and gas reserves - have long asked for higher royalties from Petronas.

Petronas is sole manager of Malaysia's energy reserves and a significant revenue source for its only shareholder, the federal government.

($1 = 4.2430 ringgit) (Reporting by A. Ananthalakshmi; Editing by Tom Hogue)

Categories: Energy Industry News Activity Asia Regulations Malaysia

Related Stories

Borr Drilling Expects Higher Activity as Rigs Return to Work

Oil Surges Over 7% to Above $102 Ahead of US Hormuz Blockade

Israel Orders Restart of Ops at Karish Offshore Gas Platform

Oil Rises as Fragile Middle East Ceasefire Sustains Supply Risks

Nam Cheong Locks In Two OSV Charters amid Tight Southeast Asia Supply

ABL Transports Northern Endeavour FPSO to Recycling Yard

CPC Oil Exports via Black Sea Stable After Attack Reports

Energy Crisis from War on Iran Deeper Than Widely Assumed

India Resumes Iranian Oil Imports After Seven-Year Hiatus

Oil Hikes 7% after Trump Says US-Israel will Keep Striking Iran

Current News

Borr Drilling Expects Higher Activity as Rigs Return to Work

Iran-Linked Tankers Sail Through Hormuz Before US Blockade

China Calls for De-Escalation as US Threatens Hormuz Blockade

Oil Surges Over 7% to Above $102 Ahead of US Hormuz Blockade

UK Declines to Support US Hormuz Blockade, PM Starmer Says

Hormuz Crisis Signals New Era of Risk for Gulf Energy

Petra Energy Secures Work Orders from Petronas for Sarawak Gas Project

Middle East Producers Gear Up for Hormuz Export Restart

Israel Orders Restart of Ops at Karish Offshore Gas Platform

Oil Rises as Fragile Middle East Ceasefire Sustains Supply Risks

Subscribe for AOG Digital E‑News

AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

https://accounts.newwavemedia.com