When we stare at the Petroleum Development Act and also the financial reports of Petronas, Shell, et al, we couldn’t help but to wonder, where did all those money have gone to?
I won’t be caring about what’s going back to the company but I would be intrigued by what is going back to the societies at large. Being grand at its scale, O&G profits are huge sum. It took only 5 years of Petronas Profit to finance the Petronas Twin Towers. Without which, KL will not have KLCC and it complexes.
Let’s look at a fishing village called Bintulu! Yes, Bintulu was a fishing village. It is wasn’t for one of the biggest Natural Gas pocket sighted in 1969 and in 1975, Bintulu will not be in this shape today. Now Bintulu is a ever growing town with the O&G whereby 7% of the country’s GDP came from.
Another fishing village started off with the which also spun off into a City is Miri! this City started it’s O&G in 1910 and now contributed to another 7% of the country’s GDP. That is USD 11.88b of which USD 594m is used yearly to develop the state. Based on per capita wise, Sarawak still have the highest per capita allocation of country’s profit from the O&G sector.
Attributing to this, the O&G is contributing to the social economics in Sarawak. Much of which came from those wages earners in the O&G which is still having the highest job grade in the countries industry-wise. This made Sarawakian’s purchase power among one of the top in the country.
On social infrastructure front, Most of the demand from the O&G sectors has driven the development plan of industrial infrastructures in Sarawak. This is made to meet the demands of the O&G which also benefits other industries.
The Bintulu Port, for instance, is one example whereby it was built for transporting LPG to oversea. However, The same deep sea port sees VLCC carrying other loads of goods to the state. And due to the contribution by O&G sector to the working of the port operation, the port is one of the lowest in the countries in terms of handling fee. This is attribute to operation management of the port as point of transit and import to the state and country.
The same O&G sector has spun off other industries which includes some of the supporting industries. This contributed to the social economic of the people by generating business opportunity and loads of other job opportunities for the people in Sarawak.
What is in the fear now is that with the oil reserve running closer to depletion, Will the same social economic balance be maintained? No one know for now how it will turn out. Meanwhile it is time for the O&G to channel their profits into more social development before their ability of contribution is supercede by time.