Petronas seeks court clarity on Sarawak operations in gas licensing dispute

[KUALA LUMPUR] Malaysia’s state energy company Petroliam Nasional Berhad (Petronas) said on Monday (Jan 12) it has filed a motion at the country’s top court seeking clarity on the legal and regulatory framework governing its operations in Sarawak state.

The filing follows stalled negotiations between Petronas and Sarawak energy firm Petros over gas distribution in the state. Talks have been deadlocked since 2024 over competing regulatory claims.

Petronas said in a statement it was seeking a determination from the Federal Court on the legal position applicable to its Sarawak operations, so it can ensure compliance with the relevant laws and governance framework.

It said while progress has been made on many commercial arrangements and partnerships, differences between the parties had “led to uncertainty in respect of the obligations applicable to Petronas”.

The filing, which named the federal and Sarawak governments as respondents, was not intended to challenge the state’s development aspirations or hinder the role of Petros in its energy sector, Petronas added.

Petros and the offices of the prime minister and the attorney-general did not immediately respond to requests for comment on the filing. Sarawak’s chief minister’s office declined comment.

Sarawak, on the island of Borneo, has long sought greater control of its natural resources and in 2024 appointed Petros to procure, distribute, supply and sell all natural gas produced in the state to downstream buyers.

The impasse with Petronas has raised concerns about potential revenue losses for the national energy firm, a major source of income for Malaysia’s federal government.

Sarawak is home to more than 60 per cent of Malaysia’s gas reserves. REUTERS