Oil Royalty Increase Will Paralyse Petronas' Overseas Forays - Awang Adek

BACHOK, Jan 13 (Bernama) -- The 20 per cent oil royalty proposal to the three oil-producing states proposed by the opposition can paralyse Petronas' overseas forays, said Deputy Finance Minister Datuk Dr Awang Adek Hussin.

Citing the proposal as unreasonable and irresponsible, he said the increase would stifle Petronas' oil exploration overseas for half of its profit came from overseas operations.

He said the company needed reserves to get new resources and new income streams for huge capital was needed to explore new oil fields.

If Petronas' growth is stunted, it will not be able to pay high dividend to the tune of RM30 billion a year to the country besides various taxes, he told reporters after presenting the cost of living allowance totalling RM109,000 to 545 Bachok fishermen here Sunday.

The opposition had proposed to raise the present five per cent royalty to 20 per cent to the three oil-producing states of Terengganu, Sabah and Sarawak in its shadow budget last year.