PUTRAJAYA (June 10): The Federal Court has fixed Aug 28 to hear an application by the Registered Trustees of Sabah Action Body Advocating Rights (Sabar), a Sabah-based non-governmental group, to intervene in the Sarawak government’s petition with regard to its petroleum rights and also the state government’s application to amend its petition or originating summons.
At the same time, the apex court will also hear national oil company Petroliam Nasional Bhd’s (PETRONAS) application to object to Sabar's application to intervene.
The date was fixed following case management before Federal Court deputy registrar Azaraorni Abd Rahman on Monday (June 8) and Tuesday (June 9).
Meanwhile, PETRONAS' application for its petition to be heard separately from the Sarawak petition over the constitutionality of its operations in Sarawak is fixed for further case management on June 16.
The Edge reported on Monday that PETRONAS had applied to separate the hearing of its petition with that of the Sarawak government’s.
In 2016, Sarawak passed legislation requiring oil firms operating in Sarawak to register with the state authority, following the formation of Petroleum Sarawak Bhd (Petros).
Initially, PETRONAS wanted its petition to be heard together with Sarawak’s petition, which was filed in February. The company then obtained leave for this from the Federal Court in March.
However, the national oil company filed a summons for directions on May 28 for the apex court’s decision over its application to separate the proceedings.
If the court allows PETRONAS’ latest application, the company will have seven days with which to serve its amended petition to both the Sarawak and federal governments, which are named as respondents. The respondents would then be permitted to amend their defence accordingly.
The national oil company wants the apex court to make a determination on its challenge on the inconsistency between the federal government’s Petroleum Development Act 1974 (PDA) and the state’s Sarawak Distribution Gas Ordinance 2016 (DGO), among others.
PETRONAS had filed the motion for leave in January to ensure that it continues to operate in full compliance with the applicable laws and sound governance practices, especially in view of the competing federal and Sarawak state laws.
Sarawak wants to amend its petition
At the same time, the Sarawak government is also seeking to amend its petition — to amend a paragraph in its court document that replaces the word 'finance minister' with 'prime minister', who has the power to control the direction of PETRONAS.
Besides the amendment, the Sarawak government maintains that in its amended petition filed on May 13, Sarawak has the exclusive power to legislate over land in Sarawak under Item 2 of List II (State List) in the Ninth Schedule of the Federal Constitution, including permits and licences for prospecting for mines, mining leases and certificates.
It also argues that Parliament had enacted the PDA without any request from the Sarawak State Legislature under Article 76(1)(c) of the Federal Constitution. The PDA law aimed to vest petroleum — found in part of Sarawak's land — in PETRONAS and included a vesting order in the Schedule. According to Sarawak, Parliament has no authority to prescribe such a vesting order, because it is essentially a mining lease or prospecting licence, which falls outside of Parliament's legislative powers.
Only the Sarawak legislature has the authority to make laws relating to permits and prospecting licences, mining leases and certificates for the mining of mineral resources such as petroleum, which are an interest in land.
The Sarawak government also alleges that the subject matter of entry of land, including permits and prospecting licences, mining leases and certificates — in Item 2(c) of List II of the Ninth Schedule of the Federal Constitution — covers also ancillary or subsidiary matters as to the authority or person empowered to grant, issue or sign any licences, mining leases and certificates for the exploration, exploitation and winning of petroleum onshore and offshore land in Sarawak.
Sabar, which was formed in 2021, applied to be an intervener in this proceeding following issues affecting Sabah, including:
- The validity and continued application to Sabah of the Continental Shelf Act 1966, and the Petroleum Mining Act 1966;
- The continued validity and binding effect of the North Borneo (Alteration of Boundaries) Order in Council 1954 and the North Borneo (Definition of Boundaries) Order in Council 1958, which define the territory of Sabah, including its continental shelf;
- The validity and continued operation of the Mining Ordinance 1960 of Sabah in respect of onshore and offshore areas after June 19, 2012.
Sabar also says that the constitutional questions raised in a 2023 originating summons pending at the High Court of Sabah and Sarawak in Kota Kinabalu should be heard together with this suit.