This case is only nominally about service of papers and which AG sits in court. Substantively, it is about who controls hydrocarbons governance in Sarawak: Malaya or Sarawak.
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1. Why Petronas Is Fighting This So Hard
Petronas is not defending RM120m. That amount is irrelevant.
Petronas is defending a precedent:
If Sarawak’s DGO is upheld, then Petronas is no longer the uncontested monopoly over downstream gas inside Sarawak.
Once that happens:
• Sarawak can license, regulate, and penalise gas distributors.
• Petronas becomes just another commercial operator subject to state law.
• Every future gas project must go through state regulatory compliance, not just federal fiat.
That is an existential shift for Petronas’ business model.
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2. Why the Federal AG’s Position Aligns With Petronas
On paper, the federal Attorney-General is meant to be neutral. In practice, the record tells a more interesting story.
Factually:
• Federal AG’s Chambers supported Petronas’ procedural position.
• Federal counsel wrote to the court indicating no objection to the judicial review.
• Federal counsel argued the federal AG is the sole guardian of public interest.
These positions are reflected in the court record.
Whether this amounts to “non-neutrality” is interpretation. But the effect is unmistakable: the federal AG’s submissions defend centralised legal authority, not Sarawak’s statutory autonomy.
In other words, the federal AG’s legal stance happens to protect exactly the same structure that Petronas depends on.
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3. Why Sarawak Is Framing the Fight as Constitutional
Sarawak’s legal strategy is extremely deliberate:
They are not rushing to argue that the DGO is valid.
They are doing something far more dangerous:
They are challenging who even has the right to define the battlefield.
Their real argument is this:
“Before you decide whether the DGO is lawful, decide who represents the public interest in state law.”
If the court accepts that:
• The State Attorney-General is constitutionally independent.
• The federal AG is not automatically the guardian of state public interest.
Then everything changes downstream:
• Sarawak controls its own enforcement.
• Federal agencies lose automatic legal authority over state statutes.
• State regulatory autonomy becomes judicially real, not political rhetoric.
This is not a gas case anymore.
This is jurisdictional warfare.
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4. How This Ties Back to MA63 and the IGC
This is where history comes back to collect its unpaid debts. This is where it gets politically radioactive.
The Inter-Governmental Committee (IGC) Report of 1962 did not treat Sabah and Sarawak as administrative provinces. It envisioned:
• Separate legal systems.
• Separate public interest guardians.
• Real autonomy in legal governance.
Putrajaya ignored this for 60 years.
Sarawak is now re-litigating MA63 in court, one doctrine at a time.
Not by grand speeches. By technical procedural fights that reshape precedent.
This is actually more dangerous to federal control than any political rally.
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5. Why This Is a Lose-Lose Situation for Malaya
Malaya has only two options:
Option A: Win the Case
They:
• Centralise legal authority
• Reassert Petronas dominance
• But politically confirm that MA63 is hollow rhetoric
This fuels:
• Sabah and Sarawak alignment
• East Malaysian autonomy movements
• Long-term legitimacy erosion
Option B: Lose the Case
They:
• Fragment legal sovereignty
• Set precedent for state regulatory supremacy
• Lose control over oil & gas governance
Which is economically catastrophic for federal fiscal structure.
Either way, Malaya bleeds.
This is why this case is existential, not technical.
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6. Why This Is Bigger Than Petronas
If Sarawak wins on the AG point, the same doctrine applies to:
• Land acquisition
• Forestry
• Carbon credits
• Environmental regulation
• Tax enforcement
• Infrastructure licensing
Every future federal encroachment becomes challengeable as:
“Federal AG has no standing over state public interest.”
Federations are not weakened by autonomy. They are strengthened through constitutional judicial authority.
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Bottom Line (The Real One)
This case is not about gas.
It is about whether Malaysia is:
• A unitary state pretending to be federal, or
• A genuine federation where states possess real legal sovereignty
Sarawak is forcing the judiciary to answer that question.
And Malaya cannot escape it anymore.
This case may be cited repeatedly in future challenges where state autonomy and federal authority intersect.
BP Reports: https://www.theborneopost.com/2026/01/24/roles-of-federal-state-ags-under-spotlight-in-petronas-subsidiaries-hearing/
