Hajiji Shoulders On For Oil & Gas Windfalls
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It is an honour for Sabahans to give the mandate for Datuk Seri Panglima Haji Hajiji Haji Noor Hajiji to lead Sabah again at the elections in November 2025. Hajiji has done extremely well in the Oil and Gas (O&G) industry as foreign giants continue to commit long-term investments in the state. He will now continue the journey to greater heights. Remember the Hajiji’s words in January 2022, when he launched the Sabah Gas Masterplan in Kota Kinabalu:
Hajiji’s efforts in Sabah’s progress have never taken any rest. He has attracted robust foreign direct investment (FDI) into the O&G sector, bolstering state revenue and boosting economic growth, anchored by strategic collaboration with Petronas. In the hands of Hajiji, major international O&G companies have committed towards further exploration, development and production in the state. The result? Sabah now leads the rest of the country in near-term FDI inflows.
Some of the successes in the O&G sector include:
- ConocoPhillips and Pertamina in the Layang-Layang basin.
- INPEX Malaysia and TotalEnergies hold stakes in exploration blocks off the east and west coasts.
- Shell Malaysia and ConocoPhillips have extended their production-sharing contracts (PSCs) to 2050.
- PTTEP Malaysia has increased deepwater redevelopment in Blocks H and Kikeh.
The state’s partnerships with these giant companies have substantially boosted the state’s economic coffers. In effect, Hajiji’s leadership in economic windfalls have greatly benefitted Sabah because half of the state government’s revenue of RM6.7 billion is derived from oil and gas activities in the form of cash payment and SST. Hajiji’s good governance has sustained investor confidence. And the CM’s push towards Sabah-Petronas collaborative deals has paved the way to economic, commercial and financial successes. The commercial collaboration agreement (CCA) with Petronas, inked in December 2021, gave greater say, revenue and participation to Sabah in the O&G industry. Hajiji proceeded to set up SMJ Energy, a wholly-owned entity of the Sabah government in 2021 to oversee, manage, and coordinate the state’s participation in the O&G portfolio.
Since then, SMJ Energy has acquired equity in multiple ventures:
- 50% stake in the Samarang PSC.
- 25% in Petronas Chemicals Fertiliser Sabah.
- 10% in Petronas LNG plant in Bintulu.
The stakes have yielded RM1.8 billion, RM323 million, and RM866 million respectively in dividends and revenue. Dividends from SMJ — amounting to RM160 million – was channelled back to the state government; and SMJ Energy paid RM91 million in SST to the state coffers. Not only the government progressed. Hajiji has insisted that Sabah’s contractors must also gain. And they did. In 2024, Sabah’s oil and gas service and equipment (OGSE) industry contractors were awarded RM2 billion worth of work. And for Q1 of 2025, the value of OGSE awarded to Sabah contractors was RM582 million, compared to RM613 million for the whole of 2021. Hajiji’s Sabah Gas Masterplan has three investment initiatives for the natural gas industry:
- Construction of a liquefied natural gas (LNG) plant with a capacity of 2.0 million tonnes per annum (MTPA) at the Sipitang Oil and Gas Industrial Park (SOGIP).
- Gas marketing and distribution in Sabah, with 120 MMscfd volume of gas for the development of key industries in the state.
- Petrochemical derivative options to attract investors; and more natural gas exploration activities for Sabah
Hajiji has assured investors the availability of gas supply including for E-Steel Enterprise Sdn Bhd (a subsidiary of Singapore E-Steel Group) who is building a RM20 billion a hot briquetted iron plant in SOGIP; and for SBH Kibing New Solar Energy SB’s solar glass plant , Phase two, amounting to RM7.2 billion.
Hajiji has said that he way forward for Sabah is to continue collaboration and deeper partnership with Petronas. The CM has promised Sabahans that better things lie ahead because he will continue ongoing discussions at the highest level between the state and federal governments for Sabah’s rights under the MA63 perimeters relating to oil royalties, cash payments and the continental shelf.
