The
retired Judge of the Court of Appeal explains the problem faced by Sabah
and Sarawak, and suggests a radical solution to the East Malaysian
states’ oil woes.
Initially, if oil was found within the
boundaries of a State in the Federation of Malaysia, it is owned by the
State. J.C Fong in his book Constitutional Federalism in Malaysia, wrote, on p. 98:
“But, the subject of ownership of
petroleum (today, an important source of national wealth with current
high global energy prices), found both on land and in the continental
shelf of the States of Sabah and Sarawak which lies within the
boundaries of Sarawak, was never a matter brought up to the
Inter-Governmental Committee and hence, not included in its Report.
Prior to Malaysia Day, the Borneo States exercised powers over petroleum
found within its extended boundaries, i.e. the seabed and subsoil which
lies beneath the high seas contiguous to the territorial waters of the
respective states. With their boundaries maintained by virtue of Article
1(3) of the Federal Constitution, after Malaysia Day, the two states
continued to exercise rights over petroleum found within its
territories, including those found offshore.”
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