Kelantan senior exco member Husam Musa has debunked a claim by the deputy finance minister on RTM’s ‘Di Luar Lingkungan’ talk-show on Monday.

Senator Awang Adek Hussin had claimed that the extraction of oil in Kelantan had only begun last year.

kuala terengganu by election 160109 husam musa Husam (right) described Awang Adek, the Kelantan Umno liason deputy chief, as not knowing anything about the state's affairs and suggested that he looks at Petronas’ annual reports for the facts.

“The Kelantan government knows for a fact that oil was first extracted sometime in January 2005. How can he make the statement that oil was only extracted last year?, Husam told Malaysiakini .

“He (Awang Adek) is one of the most inefficient deputy finance ministers (as he is) misleading the public.”

Husam, who is also Kelantan committee chairperson for petroleum development, said Malaysia has a joint agreement with Thailand to develop the oil-rich Joint Development Area (JDA). Malaysia gets 60 percent of the proceeds of sales, while Thailand gets 40 percent.

Based on the Petroleum Development Act, to which Kelantan is a signatory, Husam said the state has the right to receive the 5 percent cash payment.

azlan In 2008, the Cakerawala and Bumi Selatan oil field produced US$90 million worth of oil a day and this increased in excess of US$200 million a day last year, said Husam.

Checks with the 2004 Petronas annual report revealed that the PM301 oil platform has been in place since 2004, but that extraction began in 2005. (see map below) The oil field is 130 nautical miles from Kota Bharu.

Kelantan is claiming between RM600 million and RM2 billion in oil royalty from the federal government on the basis of the 5 percent cash payment agreed upon and signed by Petronas founder-chairperson Tengku Razaleigh Hamzah and then menteri besar Mohamad Nasir.

Yesterday, Husam had shot down the government’s arguments published in the government’s full-page advertisement published in Malay dailies on Sunday.

   

‘Evidence in hand’

During the talk show,  a viewer from Pasir Mas, Kelantan, had phoned in to ask Awang Adek why the government is only now explaining its rationale for not making the cash payment.

asli capital market summit 131107 awang adek Awang Adek (left) replied that oil was extracted only in 2009 and hence Kelantan was only entitled to the RM20 million ‘goodwill’ payment.

On Tengku Razaleigh disclaimer regarding payment to Terengganu, Awang Adek said he has evidence from newspapers like the New Straits Times , Berita Harian and Utusan Malaysia . In 2000, they had quoted Razaleigh as questioning why the state was receiving oil royalty.

Tengku Razaleigh, who has said he was misquoted, had on Monday supported Kelantan's right to receive oil royalty on the same basis as Terengganu.

In reply to the issue raised in the advertisement, Tengku Razaleigh said he and former Lord President Salleh Abas had been willing to testify as to why Terengganu - then under PAS rule - was entitled to receive the oil royalty withheld by Dr Mahathir Mohamad's administration.

'K'tan more than entitled to oil royalty'