Dispute a threat to investment climate

摘要

THE unresolved issues between Sarawak, the federal government and national oil company Petro-nas are threatening the upstream investment climate in Malaysia. The recent change of guard at Petronas is "purely politically driven as (former) chief executive (Wan Zulkiflee Wan Ariffin) resisted the 5% tax payment to Sarawak," a Malaysian oil company executive tells Upstream. "The prime minister needs the support of the 18 Sarawak MPs to stay in power, so he facilitated the payment by removing Wan Zulkiflee and putting a more compliant chief executive officer in instead." He adds that the political situation in Malaysia discourages investment, with the production sharing contract not really being honoured and an additional 5% sales tax being imposed at oil companies' expense.