KOTA KINABALU, Sept. 13 2025 – Sabah is not out to dismantle national oil giant Petronas, but rather to foster a new “golden goose” of its own through deeper collaboration in the energy industry, Domestic Trade and Cost of Living Minister Datuk Armizan Mohd Ali said today.
In a strongly worded rebuttal to critics, Armizan, who is also Gabungan Rakyat Sabah (GRS) deputy secretary-general, emphasised that the state’s push for greater involvement in oil and gas (O&G) operations is rooted in over five decades of untapped potential. “We reject the notion that our demands could collapse Petronas – the golden goose that has laid eggs for the nation,” he stated. “Our goal is for Petronas to help birth a new one: SMJ Energy Sdn Bhd, wholly owned by Sabah.”
The remarks come amid ongoing debates over resource rights in Borneo states, with Sabah’s recent gains in O&G revenues spotlighted at the 28th Sabah District Officers Conference earlier this week. Chief Minister Datuk Seri Panglima Hajiji Noor, speaking at the event on Sept. 11, credited a pivotal 2021 meeting with Petronas leadership for unlocking billions in state benefits.
Armizan, who joined Hajiji and State Finance Minister Datuk Seri Masidi Manjun for that August 28, 2021, engagement in Kuala Lumpur, recalled how the delegation presented a comprehensive written framework of Sabah’s aspirations. “For the first time, Petronas received structured proposals from the state, rather than scattered oral demands from various platforms,” he noted. The session marked a turning point, leading to the signing of the Commercial Collaboration Agreement (CCA) on December 7, 2021.
Under the CCA, Sabah has secured “greater say, greater participation, and greater revenue sharing” in the sector, overseen by permanent committees that convene regularly – including at the highest level with the Chief Minister’s direct involvement. This has expanded beyond royalties and state sales tax to include equity stakes in upstream, midstream, and downstream activities.
Key milestones include Sabah’s ownership in multiple O&G fields and a surge in local contractor involvement, now exceeding 1,000 firms. State-owned SMJ Energy Sdn Bhd has been mandated to spearhead these efforts, recently acquiring a 50% stake in the Samarang production-sharing contract – encompassing seven offshore fields off Sabah’s coast.
“From that moment, our story isn’t just about royalties anymore,” Armizan added. “It’s about building sustainable equity and participation that benefits Sabahans for generations.”
Hajiji echoed these sentiments at the conference, attributing the state’s RM1.3 billion education investments over his four-year tenure to the Hala Tuju Sabah Maju Jaya (SMJ) blueprint, which integrates O&G gains into broader development.
He stressed that presenting “what is fair” during early talks with Petronas Chairman Tan Sri Mohd Bakke Salleh and President/CEO Tengku Muhammad Taufik yielded results, proving diplomacy over confrontation.
As similar resource disputes simmer in neighbouring Sarawak – where Petronas has reportedly reaped RM2.25 trillion from state resources against just RM50 billion in royalties since 1974 – Armizan’s comments underscore Sabah’s collaborative ethos.
“After 50 years, it’s time Petronas partners in creating our own golden future,” he concluded.
The minister’s statement arrives as Petronas continues to navigate regional sensitivities, with recent engagements on pricing policies and MSME support highlighting its role in Sabah’s economy.