Explanation Petroleum Claims Issues

All states including Kelantan same class at the Petroleum Development Act 1974. All states that sign the agreement with Petronas in 1975/1976 will receive cash payments of 5% of the value of petroleum found in the state.

Here are answers to the issues is the claim;

1. What is the term referred to the Petroleum Development Act 1974 on payment of oil and gas?

Terms that apply for the purposes of payment is "cash payment" of 5% and the word "royalty" is not used in any terms the Act.2. What qualifications state governments to get 5% cash payment as mentioned in the agreement between Petronas and state government year 1975/1976?

Oil or gas wells must be located within the boundaries of state land and the territorial waters of the state as far as 3 nautical miles measured from low tide level (the Emergency (Essential Powers) No.7 Year 1969).
3. Is Kelantan state government or any state governments in Peninsular entitled to claim a cash payment from Petronas oil?

Kelantan State or any state government in the peninsula is not entitled to because of all oil and gas wells that produce results in the peninsula at present outside the territorial waters of the state more than 3 nautical miles. Therefore any results obtained outside the state waters beyond 3 nautical miles are owned by the Federal Government.
4. What is the position of Sabah and Sarawak on the issue of royalty payments?

Before 1974, the state government of Sabah and Sarawak already has a place of their own rights through royalty agreements and the effective operation of the Continental Shelf Act 1966. It is a historical and current privilege recognized joined Malaysia in 1963.

5. What is the payment Wang Ehsan?

Ehsan is a contribution of money or assistance is channeled discretion based
Federal Government to states including Kelantan. This contribution is outside the scope / jurisdiction of the Petroleum Development Act 1974 and agreements signed between Petronas and state governments in tahun1975/1976. This assistance is provided solely on the awareness and responsibility based on concerns the Federal Government to the welfare state and people.
6. Why Wang Ehsan offered by the Federal Government to the state of Kelantan only amounted to about RM 20 million?

This provision gives the Federal Government on policies relating to ehsan gas produced in Federal waters. Kelantan State Government have no rights in the area because it is outside the waters 3 nautical miles.
7. What position statement from the former Chairman of Petronas, YB Tengku Hamzah Rezaleigh that royalties should be paid to the state of Kelantan from petroleum products obtained from outside state waters and the disputed provision of Wang Ehsan.

Press YB Tengku Razaleigh Hamzah, Gua Musang member of parliament should be seen as his personal opinion alone. Any decision taken regarding the right to royalty payments made based legal provisions and related agreements signed between Petronas and state governments.

YB Tengku Razaleigh Hamzah had explained that the government can not be disputed Terengganu Pas Wang Ehsan position because of money channeled for this even though the name of oil royalties, the state is not right.

He also stated during the Petronas has established a state noted that no pun in Peninsular entitled to the oil found in the area outside the "territory" they (BERNAMA - 1 November 2000)

Although YB Tengku Razaleigh Hamzah has changed holdings at this time, the law remains unchanged. Citizens and states must respect the laws of the country.

8. Are opposition leader informed about the rights of state governments in this regard?

Based on the provisions of existing legislation, opposition leader is aware of the state government have no right to any cash payments or royalties related to petroleum products which explored outside the territorial waters of the state. Because of this, opposition leaders had tried to propose amendments proposed Petroleum Development Act 1974 in Parliament in December 2009 that then.

With the Leader of the Opposition was aware that their own government Kelantan State no right over any oil or gas wells within the Federation.