PETRONAS Seeks Clarity on Petroleum Regulatory Framework in Sarawak

PETRONAS has submitted an application to the Federal Court in Putrajaya seeking clarification on the regulatory framework governing its operations in Sarawak. The respondents named in the application are the Federal Government and the Government of Sarawak.

The application requests a determination on the legal framework applicable to PETRONAS’ activities in Sarawak, with the aim of ensuring continued compliance with all relevant laws and sound governance standards. The move is not intended to undermine Sarawak’s development objectives or impede the role of Petroleum Sarawak Berhad (Petros) within the state’s energy sector.

This step follows ongoing constructive engagements since 2024 with Petros, as well as with the Federal and Sarawak state governments, through a series of discussions and negotiations. While progress has been achieved in several commercial arrangements and collaborations — including the Commercial Settlement Agreement (CSA) signed in 2020 — certain differences remain, resulting in uncertainty regarding PETRONAS’ obligations.

PETRONAS has therefore called on all parties to respect the judicial process and allow the matter to be resolved by the Federal Court, while refraining from public commentary.

In the interim, PETRONAS will continue its operations in Sarawak safely, reliably, and efficiently, with business activities proceeding as usual. The company remains committed to strengthening its relationships with local communities and industries, and to working collaboratively on arrangements that support Sarawak’s development aspirations and Malaysia’s long-term prosperity.

PETRONAS also reaffirms its commitment to transparent communication regarding its operations and partnerships.