KUALA LUMPUR – Malaysia’s state-owned energy firm Petronas said on May 2 its subsidiary Petronas Carigali had received notices from the Sarawak state government regarding its gas processing and distribution rights in the state, with the local media reporting it did not have proper permits.

Petronas did not give details of what notices said, but the local media said the subsidiary was operating its Miri Crude Oil Terminal without a licence.

The reports said the state government has given Petronas Carigali 21 days to obtain the required licence or face financial penalties under local state law.

Petronas said its subsidiary is authorised under federal law to undertake activities for the parent company and comply with all applicable laws. Therefore, Petronas said it has a duty to uphold the federal law and safeguard national interests.

“Petronas will continue to engage constructively and work closely with the federal government, Sarawak government, and Petros in exploring future arrangements to ensure regulatory clarity and operational continuity for the benefit of the industry, state, and nation as a whole.

“We are also committed to ensuring that the rights and interests of all parties, including end-consumers and investors, are addressed accordingly,” it said.

Petronas has been engaged in stalled negotiations with Petros, Sarawak’s state-run energy firm, since 2024.

The impasse had raised concerns about the potential impact on Petronas’ revenues, a major source of income for the federal government. Sarawak is home to more than 60 per cent of Malaysia’s gas reserves.

Reuters has reached out to the Sarawak state government for comments. REUTERS

Join ST's Telegram channel and get the latest breaking news delivered to you.