KOTA KINABALU: Parti Solidariti Tanah Airku (STAR) president Datuk Seri Dr Jeffrey Kitingan said an oil refinery proposed to serve Borneo and the North Asian market should be built in Sabah, not Labuan.
He welcomed former Sabah chief minister Tan Sri Harris Mohd Salleh’s call for an oil refinery, describing the strategic argument as sound as Sabah and Sarawak produce more than 60 per cent of Malaysia’s oil and gas.
He said the ongoing Middle East conflict exposed the danger of processing resources thousands of kilometres away and strengthened the case for refining capacity closer to the source.
However, he said Labuan is not the answer.
Jeffrey said Labuan is a Federal Territory, and a refinery built there would be a federal asset, not a Sabahan one.
He said Sabah would continue to supply crude oil and gas while the refinery premium would flow to the Federal Government.
He added that this is already happening with the Bintulu pipeline and the Pengerang complex.
He said Sabah’s gas was piped raw to Bintulu, processed and liquefied there, and sold to Japan, South Korea and China at international market prices, while Sabah collects five per cent royalty on the raw value and buys back the finished product at market rate.
He said the pipeline is now being decommissioned and Sabah’s gas will soon have nowhere to go.
Jeffrey said both the oil refinery and gas processing facility must be built in Sabah, owned by Sabah and operated by Sabahans.
He said the facilities should not be located in a federal territory or outside the state.
“We must process our resources in Sabah so we keep the value where the resources come from,” he said. – Wu Vuide
Jeffrey said both the oil refinery and gas processing facility must be built in Sabah, owned by Sabah and operated by Sabahans.
