Najib tells govt: Don't dip into Petronas' coffers
By SYED UMAR ARIFFMay 31, 2018 @ 6:10pm
KUALA LUMPUR: Datuk Seri Najib Razak has urged the government to refrain from dipping into Petronasâ coffers for âbailout missionsâ as what Prime Minister Tun Dr Mahathir Mohamad did during his previous administration.
Commenting on the decision to compensate the planned abolishment of goods and services tax (GST) by requesting that Petronas, Khazanah Nasional Berhad and Bank Negara Malaysia fork out higher dividends for the government, Najib said such a measure was unsustainable and only for a short term.
âPetronasâ revenue depends on the world oil and gas prices, which is not under its control. Gross dependency on the higher price of oil should also be avoided.
âAlthough the global oil price (per barrel) is higher tha n the forecast made in the 2018 Budget which I had tabled last year, we need to be prepared should it plunge by 80 per cent, just as what had happened in 2014 and 2015.
âI plead for the new government to continue providing substantial space and capital for Petronas to fulfil its vision, instead of raiding into its coffers for bailout missions which took place during Dr Mahathirâs 22 years of administration back then.â
At the same time, the former prime minister said Petronasâ cash reserves had increased to RM164.7 billion at the end of March; an increase of RM36.5 billion compared to the RM128.2 billion which was recorded during the last three months of 2017.
Najib attributed the increase to a reassuring increase in oil prices and Saudi Aramcoâs payment for its investment in the Refinery and Petrochemical Integrated Development (Rapid) project in Pengerang.
âThe reserves are much higher compared to 2008 when I first took office as finance minister .
âDuring my administration, I was scrupulous in ensuring that Petronas would not have to pay dividends more than what was required because I need to make sure that there were sufficient funds to meet development plans in the main and downstream business sector.â
Najib said, as a result, Petronasâs funds had increased significantly and the company was able to carry out game-changing projects such as Rapid, Sabah-Sarawak Integrated Oil and Gas Project and Sabah Ammonia Urea or Samur.
âAt that time, Petronas was given the freedom to invest in both local and international upstream projects such as in Canada, Iraq and Brunei.
âThese investments have the potential to yield high dividends for Petronas and Malaysia in the long term. We invest for returns in the long run.â
(File pic) Datuk Seri Najib Razak has urged the government to refrain from dipping into Petrona sâ coffers for âbailout missionsâ as what Prime Minister Tun Dr Mahathir Mohamad did during his previous administration. (AFP PHOTO / Mohd RASFAN)89 readsSource: Google News