'SABAHAN SHOULD BE INVOLVED IN PETRONAS DECISION-MAKING'

'Sabahan should be involved in Petronas decision-making'

Kota Kinabalu Feb 16, 2012: The Sabah Oil and Gas Contractors Association (Sogca) wants to see at least one Sabahan sit as a Vice President in Petronas, in view of the State's big contribution to the national oil and gas industry.

Its President Datuk Iskandar Datuk Malik said with the huge number of Petronas projects in Sabah involving hundred billions of ringgit, the association would like to see the position of Petronas top personnel in Sabah elevated to Vice President.

He said currently the highest post given to a Sabahan is only General Manager for Sabah and Labuan, which is held by Joseph Podtung, but who is not involved in any decision-making.

Many Sarawakians hold top posts in Petronas, including Senior Vice President post, he told a press conference in Wisma Kosan, Wednesday.

Sogca also proposed that 30 per cent of the local contents of jobs in oil and gas industry be given to Sabah-based companies.

"Sogca suggests that Petronas also give priority to Sabah-Peninsula Malaysia joint-venture contractors to implement the jobs in Sabah, instead of imposing Sabah-Foreign JV sub-contractor," he said.

Sogca noticed the procedures of contractor selection by Petronas in awarding the sub-contractors a job in the Sabah Oil and Gas Terminal (SOGT) reflected non-patriotism, as most are Sabah-Korean JV sub-contractors.

He said Sogca had been receiving many complaints from contractors regarding difficulties in obtaining licence and registration from Petronas.

"Previously, the approval of registration was done by the Sabah Regional Office in Kota Kinabalu. However, when Petronas introduced the new system, contractors had to wait from Petronas KLCC office to get the approval," he said.

With the appointment of a Sabahan as head of Petronas Sabah and Labuan Regional Office, Sogca has no doubt that he should also be given the authority to execute the approval for the licensing and registration matters.

Touching on the work value for Sabah contractors, he said the jobs sub-contracted to Sabah contractors were mostly civil and infrastructure works, even though they are capable of engineering works e.g. welding, mechanical, piping works and electrical instrument.

"Samsung, one of the contractors in SOGT, awards projects to Korean companies and brings in workers from Thailand, Indonesia and Philippines to work on the site, leaving no opportunities for Sabahans," he claimed.

He said people are also asking why Petronas takes 60 per cent equity in the Kimanis Power Plant when Yayasan Sabah should be the majority shareholder and that the implementation of Alliance Interated Team Concept (AIT) by Petronas in Sabah is suffocating local contractors.

The AIT concept gives more power to Samsung, allowing it to "manipulate" the award of contracts and sub-contracts, resulting in Koreans getting jobs and sub-contracts.

"These Korean sub-contractors, in turn, sub-contract the jobs to local contractors who are 'forced' to 'take it or leave it'Éwhy does Petronas allow this?" he charged.

He said these actions by Petronas would adversely affect its integrity in the long-term. "Oil and gas industry players in Sabah felt strongly that Petronas seconded staff at AIT should be rotated in order to neutralise Samsung's 'powerful' roles in SOGT," he said.

There are also deep concerns about why Korean contractors/workers are exempted from Construction Industry Development Board (CIDB) requirements, he said. "How can foreign workers and companies walk into Malaysia without having to apply for permits?"

He said Sabahans are also skeptical about Petronas' claim to give Sabah contractors jobs. "This has not happened beforeÉso why will it happen now?" he said, adding the association and dismissed as untrue, Petronas' claim that Sabahans were not interested to work in the oil and gas industry.

"Many Sabahans are working in the oil and gas industry including in foreign countries.

"Petronas' decision to pipe gas from SOGT to the LNG Complex in Bintulu has not gone down well. Sabahans feel that they have been deprived of a project and its spins off.

Sabah contractors are also complaining that only RM600milllion will be given out to them while the entire plant costs RM4.6billionÉso who will benefit the most from this project?

Are they non-Sabahans?"

Iskandar said some quarters in Sabah are also questioning why the five per cent petroleum royalty account payable to the State Government by Petronas is not audited by the Auditor-General.

Thanking and supporting the Government effort to develop the oil and gas industry in Sabah, particularly the State Government which aspired to create and increase the business, job opportunities and income for Sabahans, he said Sogca hopes that the problem in SOGT would not be repeated in the Sabah Ammonia Urea (Samur) Project in Sipitang, which is also developed by Petronas.