By Datuk Seri Panglima Dr Jeffrey Kitingan
Deputy Chief Minister and Minister of Agriculture, Fisheries and Food Industry
Press Statement – Feb 16, 2025
KOTA KINABALU – I fully support the position of Dato’ Sri JC Fong, the former Attorney-General of Sarawak, regarding Sarawak’s sovereignty and ownership of land, as well as any petroleum and gas found in the seabed and subsoil of its continental shelf.
In my view, Sabah’s sovereignty and rights over its own territory—including the continental shelf and all petroleum and gas therein—are precisely the same as those of Sarawak.
We draw on the 1954 Orders in Council, issued by Queen Elizabeth II of England, which extended the boundaries of Sabah and Sarawak from the foreshore to their respective continental shelves.
These boundaries were duly acknowledged prior to Malaysia Day in 1963 and later enshrined in Article 1(3) of the Federal Constitution.
Consequently, since 1954, the land in Sabah and Sarawak—including the continental shelf and the resources beneath—has vested in our respective State Governments.
In Sabah, Section 24 of the Sabah Land Ordinance explicitly reserves petroleum and gas for the State Government.
The Government of Sabah, led by the Chief Minister, is empowered to grant licences for the exploration, extraction, and transport of these resources, on such terms and conditions as may be imposed.
In 1969, the then Chief Minister, Tun Mustapha, executed six oil exploration and production agreements with international oil companies, ensuring a 12.5% royalty for Sabah.
By 1975/1976, Sabah was already producing oil; however, on 14 June 1976, the then Chief Minister signed an agreement—commonly referred to as the ‘Oil Surrender Agreement’—with Petronas, reducing Sabah’s share to a 5% cash payment.
According to the Sabah State Assembly Hansard of December 1976, we received RM20 million for this 5% share, whereas Petronas and the Federal Government collectively took RM380 million, representing 95%.
This situation highlights the significant financial losses Sabah has shouldered over the years.
As our rights over petroleum and gas resources mirror those of Sarawak, we ought to receive equivalent benefits from Petronas—nothing more and nothing less.
Whatever concessions Petronas grants to Sarawak should likewise apply to Sabah.
