Tengku Razaleigh backs Kelantan claim to oil money

Written by Sharon Tan, The Edge

Former Petroliam Nasional Bhd (Petronas) chairman Tengku Razaleigh Hamzah has thrown his support behind the Kelantan government's claim of RM1 billion in oil royalty, saying that Petronas is obligated by law to pay up.

In an interview with online news portal The Malaysian Insider, Tengku Razaleigh, who as the founding chairman of Petronas inked the vesting deed agreement on behalf of Petronas and Kelantan in the 1970s, said the state is entitled to its 5% of any revenue derived from deposit found on or offshore Kelantan.

"If I am chairman still of Petronas, I will pay without all the fuss. And I feel all the more it should be paid because I signed the agreement! There are no two ways about it. It must be paid," he said, adding the question of disputed area did not arise because Petronas is operating in an offshore area of Kelantan.

On whether the state could take Petronas to court, Tengku Razaleigh said there was no need to do so because Petronas is obligated to pay.

"Look, we have this money and we want to help states like Kelantan, Terengganu, Kedah because those states are poor states, undeveloped states, like Sabah, Sarawak, they are also undeveloped states. Why grudge the pay? Those people are taxpayers all the same. They may have supported PAS in the last election. But it does not mean they are not citizens of this country. They have same rights as the others," he added.

Tengku Razaleigh however refused to comment whether there were political considerations in the decision not to pay Kelantan any oil royalty.

But he noted that oil royalty payment to Terengganu was suspended when PAS ruled the state from 2000 to 2004 and only reinstated early this year.

He also said the under the agreement, the money has to be paid to the states and not the federal government departments because only the state is entitled to the payment.