Petronas will no longer be able to hire people from outside of Sarawak to fill jobs in the state after the state government imposed a moratorium on new work permits.

This was announced by Sarawak deputy chief minister Douglas Uggah Embas, according to The Borneo Post.

“The state government will put a moratorium with immediate effect on all new applications for work permits from Petronas personnel from outside Sarawak who intend to work in Sarawak," he was quoted as saying.

Douglas added that the state government had sought an explanation from the Petronas and the oil giant said the retrenchments were part of its efforts to reduce costs.

He added that the state government is awaiting a detailed report from Petronas on the participation of Sarawakians in the oil company's operations in the state.

The move came amid complaints of Sarawakians being retrenched from Petronas' operations in the state despite the already low participation from locals.

Sarawak state-founded think tank Suarah Petroleum Group (SPG) claimed only 39 percent of management positions and 46 percent of mid-management positions in Petronas' Sarawak operations were filled by Sarawakians.

This prompted calls for government intervention, with Sarawak DAP chief Chong Chieng Jen even proposing that they cancel the work permits of peninsular Malaysians working with Petronas in Sarawak, until Sarawakians' participation is raised to 70 percent.

If implemented, it would render peninsular Malaysians working with Petronas in Sarawak jobless overnight.

Chong in a statement today hailed the state government's move to exercise its autonomy to deal with the employment of Sarawakians in Petronas.

"The fact that the state government has to go to this extent just so that Petronas will review its unfair employment policy towards Sarawak is clear proof of the fact that all the so-called sweet and cordial relationship between Sarawak Chief Minister Adenan Satem and Prime Minister Najib Abdul Razak amounts to nothing when it comes to the distribution of resources between Sarawak and West Malaysia.

"Therefore, (the) Sarawak government should start taking a hard position and tough action against the federal government when it comes to negotiation with federal government for Sarawak’s rights," he said.