Wednesday, June 29, 2022

What is there for Sarawak to shout about?

Secara Rawak

Sarawak is richly endowed with natural resources. Sarawakians are proud that their state has oil, gas, timber, hydo-electric potentials, and so on. With all these resources, Sarawak should be quite advanced economically by now, and could easily attain a developed state status by the year 2020.

We know a lot of the things in Kuala Lumpur such as the twin towers are built using oil money. Despite being an oil-producing state, there is nothing of any importance or significance in Sarawak that its peoples can proudly say is being built using oil money. Even the oil and gas districts of Bintulu and Miri are still lacking good roads and other essential amenities.

With the kinds of natural resources that Sarawak has, the state should have a world class road and communication systems. All households in Sarawak should have electricity and treated water supply already. And all the children in the state should be learning in a comfortable and conducive school environment with modern facilities.  

The state should have more than enough money to train its teachers, doctors, engineers, accountants, skilled workers, technicians, and so on.

But in reality, Sarawak is still light years away from having all of these.

Of the poorest states in the federation, four are oil-producing states, and unfortunately, Sarawak is one of them. Why is Sarawak poor and less developed?

Is this due to the lack of inspiring state leadership, poor resource management, inefficient public sector, wastefulness of the Sarawak state government, or is it because that there is a substandard quality all around and in all aspects of the state administration?

Or is it because that the state does not have the money that it thought it has?

The most lucrative of all the natural resources to explore is oil and gas. But does Sarawak still have them.

The law says that anything that is beyond 3 nautical miles offshore do not belong to the state. In terms of oil and gas, what this means is this: any oil blocks that are found outside the 3 nautical miles of the state shores do not belong to Sarawak anymore.

The federal government has jurisdiction over all areas outside the 3 nautical miles of Sarawak shores, and up to at least 200 miles offshore, and within what is known as the free economic zones.

Common sense dictates that there are going to be more oil blocks outside than inside the 3 nautical miles, and therefore more royalty money to be collected by the federal government than by the state governments.

Common sense also dictates that oil and gas explorations should take place first within the 3 nautical miles areas, as it is cheaper, more efficiecnt, more economical, and less risky to do so.

If rationality still prevails, explorations outside the 3 nautical miles will only happen when the oil wells inside have dried up.

This means that if the oil within the 3 nautical miles has all been pumped out, then Sarawak has no rights under the provisions of the current laws, to claim any royalty at all, as the oil outside these areas does not belong to it anymore.

And if Sarawak still get the royalty even when oil wells or blocks have all dried up, then that money is kind of a compassionate or a good will money (wang ehsan) from the federal government.

The second one is even more detrimental to the state interests. Under the law, any oil and gas deposits offshore could be interpreted to belong to the federal government. This means that, even if the oil wells are located just a yard into the sea, these oil wells do not belong to Sarawak anymore.

Oil and gas are‘gifts of God’, but then what is there for Sarawak to shout about if it has none left.

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