Paul Sir, Sarawak News - Saturday, June 21, 2008 10:00 - 0 Comments

 Email This Post |  Print This Post

Petronas, please lay bare for all to see

WHEN one mentions Petronas, it immediately conjures an image of big, superior and powerful. And why not! It is the national oil company and Petronas is the number one conglomerate in the country. Possibly, it is also the most well-known Malaysian company in the world.

Established 34 years ago, Petronas has often been described as the national ultimate ‘cash cow’. Its stakes are high and it is understandable why the people are now posing serious questions on how the company’s billions and resources are being utilised. Rightly or wrongly, Petronas had been used to bail out other conglomerates deemed as critical to the government in times of economic crisis. This has not gone down well with the people, principally because they had been left in the dark on what these bail-outs entailed.

The recent fuel hike has caused Petronas to go under the microscope again. Since June 4 when Malaysians have to pay RM2.70 a litre for petrol, the national oil company has been the subject of intense discussion among Malaysians. Most are unable to comprehend why they must pay such a steep price for petrol when the nation is a net exporter of oil.

The government and Petronas have tried to explain the situation and among the reasons for the hike are speculative activities in the world oil market and geopolitical problems. Tell the layman on the street that and he will just shrug his shoulders. He does not understand economics. What he understands is that he is feeling the pinch and is having difficulty in trying to make ends meet for himself and his family.

Likewise for politicians and the upper echelon of society; what they want to know is all about Petronas and why it is unable to cushion the blow amidst the global price hike for the benefit of Malaysians. To them, and rightly so, how Petronas is managed is crucial and uppermost in their minds.

Both opposition leaders and government legislators have repeatedly called on Petronas to strip its accounts naked for all to see. The most prominent MP, and a surprise one, to join the chorus was Rembau representative Khairy Jamaluddin and son-in-law of the prime minister.

Khairy, who is also Umno Youth deputy chief, urged Petronas in Kota Kinabalu last Saturday to make public details of its profits as well as its sources of revenue.

Interestingly, and again not surprisingly, (since it was Malaysia’s most ‘powerful son-in-law’ who fired the shot) Petronas president and chief executive officer Tan Sri Hassan Merican declared last Monday that the national oil company’s accounts will be laid bare for public perusal next week.

Like many of you, I am also waiting anxiously to view with my naked eyes what Petronas is willing to lay bare next week. But I doubt I will be satisfied with just this one revelation.

I would like to see laws being enacted which will compel our national oil company to be transparent in all its dealings. I think we are entitled to a report card from the company annually in detail on its activities. How our nation’s oil revenue is being used must be made known to all and sundry.

I feel that the Petroleum Development Act 1974, in which it is stipulated that the national oil company is answerable only to the prime minister, must be amended. Petronas is currently not under the jurisdiction of parliament so that law has to be changed.

The government and Petronas have taken the first step in declaring that the company’s accounts will be made public. It may be a case of ‘too little too late’ but let us credit them for taking that giant step towards more transparency and accountability of how our oil revenue is being used. However, I would urge that they go a step further by legislating a new law to make Petronas answerable to parliament. I sincerely hope and believe that parliamentarians from both sides of the august House would support this amendment to the Petroleum Development Act 1974. The sooner that is done the better.

On record, Petronas contributes 35 per cent of the federal government’s revenues via taxes, dividends and royalties. It also spends RM40 billion a year on exploration and development. There are also the billions in direct subsidy for gas used by power producers to generate electricity. Possibly, because of such features on the oil corporation’s bottom line, it is unable to directly subsidise fuel now at a global high.

It’s true that Malaysians have never been so sore and angry with Petronas. The 40 per cent hike is unacceptable and intolerable. That best explained the ‘Boycott Petronas Campaign’ being widely circulated on the Internet.

The campaign proponents explain:

“With the price of gasoline going up more each day, we consumers need to take action. The only way we are going to see the price of petrol come down is if we hit someone in the pocketbook by not purchasing their petrol. Don’t purchase any petrol from Petronas. If they are not selling any petrol, they will be inclined to reduce their prices. If they reduce their prices, the other companies will have to follow suit.”

To be fair to Petronas, here’s Tan Sri Hassan Merican’s take on the campaign. “Boycotting Petronas products can affect all the entrepreneurs in the chain of business. If their businesses suffer, companies servicing them will also suffer. So is it fair for the 800 Petronas station operators to be punished for the high fuel prices when they are not at fault in the first place?”

As a consumer, I can respond to Hassan Merican’s plea. Why should I worry about the 800 Petronas station operators in the first place? I should worry more for my fellow 26 million Malaysians who are suffering — the lower income group in particular who are struggling to even provide three square meals for their families. That should be my priority concern.

If the 800 station operators are put out of business because of the boycott, don’t blame the consumers. They should blame Petronas. I would even venture to suggest that they seriously contemplate changing jobs or businesses. Go sell nasi lemak, pisang goreng or roti canai. Possibly, it could turn out to be more lucrative than selling Petronas petrol.

For me, I don’t have to be enticed by the boycott. I have never been a Petronas consumer and I do not have to make any apology for that.

Ultimately, Malaysians want to know in fine print who will be benefiting and in what way from the government the funds coming into its coffers from Petronas. That is due to them and I hope that transparency and accountability will remain permanent features in all national companies, not only Petronas.

Meanwhile, I join other Malaysians in waiting impatiently for Petronas to strip naked next week.

(Comments can reach the writer at paulsir99@hotmail.com)