Form company to mine hydrocarbons, REE, Penang govt told

PH assemblyman Lee Khai Loon proposed that Penang form a state-owned firm to oversee oil and gas exploration within its state borders. (Reuters pic)

GEORGE TOWN: The Penang government should form a company to examine the exploration and extraction of hydrocarbons and rare earth elements (REE), a backbencher told the state assembly.

“I propose that we create a state-owned company that will look into this (hydrocarbon and REE extraction) and not just wait for royalties.

“We need to work on this because (these minerals) are found on Penang lands,” Lee Khai Loon (PH-Machang Bubuk) said while debating the state’s 2024 supply bill.

Lee said that the Penang government should learn from its Selangor counterpart, which uses Kumpulan Semesta Sdn Bhd for exploration, extraction and sale of sand, rocks and minerals.

On Friday, Penang chief minister Chow Kon Yeow said that Penang might consider taking Sarawak’s path to introduce sales tax on petroleum products in the event oil is found in its waters.

This came in the wake of Petronas’s statement on Nov 15 that it is mapping the hydrocarbon potential of the Langkasuka Basin, which covers the waters off Perlis, Kedah and Penang.

Also on Friday, FMT reported housing and environment executive councillor S Sundarajoo as saying in an assembly written reply that the state government had discovered nearly RM100 billion worth of REE deposits across the state.

The mineral and geoscience department identified four areas – Teluk Bahang, Balik Pulau, Bukit Mertajam and Bukit Panchor (Nibong Tebal) – with significant non-radioactive REE deposits, totalling about 1.7 million tonnes.

O&G jobs potential in Penang

Meanwhile, another backbencher, K Kumaran (PH-Bagan Dalam) said that the oil and gas sector is dependent on a highly skilled workforce, which can create new job opportunities for professionals in Penang.

The DAP assemblyman called on the state government to be ready to prepare public facilities that would help support the growth of this sector, as well as work on talent pool development.

He also suggested that the development of the Silicon Island project in southern Penang island take into consideration the oil and gas sector.

Kumaran said the REE discovery needed to be studied in detail as it involved areas that were developing and forest reserves.

He said exploration needed to be discussed with agencies such as the land and mines department, district offices, local councils, urban and rural planning department.

Kumaran urged the government to carry out an environmental impact assessment (EIA) to determine the impact of REE exploration and extraction on the environment.

He also called on the government to table an enactment that would put in detail the safety and environmental controls for mining before any work is carried out.

“Although the REE mining sector could be another economic leap for Penang, it should not come at the cost of the safety and lives of our rakyat,” Kumaran said.