Wan Zulkiflee Wan Ariffin quit this month after disagreement with the prime minister over giving more oil money to Sarawak.
Ex-Petronas chief executive Wan Zulkiflee Wan Ariffin stepped down as he disagreed with the government’s plan to pay RM2 billion in oil and gas sales tax to the Sarawak government.
A source close to Wan Zulkiflee told Reuters that he could not agree to the deal and resigned in protest.
“Wan Zulkiflee resigned because of principles, that he is not agreeable to the Sarawak deal.
“The new government is open to giving more to the states that produce oil,” said the source close to the government.
The source said Muhyiddin was in no position to decline requests from Sarawak because the state’s main party – Gabungan Parti Sarawak – has 18 out the 222 elected seats in parliament and is key to keeping him in power given his single-digit majority.
In addition to agreeing to the sales tax, Muhyiddin had shown that he was open to demands from Sarawak and Sabah for more royalty payments, the sources said.
Wan Zulkiflee had previously said that increasing royalties could make operating in Sabah and Sarawak unfeasible. By some estimates, quadrupling the royalties from the current 5% would cost Petronas $7 billion a year.
Petronas had maintained that it has the sole rights to all oil and gas resources nationwide, including in Sarawak, and had taken the dispute to the courts.