A private firm has been granted a licence to explore for gold in Semporna’s resource-rich Nagos region — a move Sabah’s chief minister says is aimed at protecting public funds while gauging the site’s true mineral value.
Chief Minister Datuk Seri Hajiji Noor told the state assembly that only a prospecting licence had been issued, not a mining lease. The distinction, he said, was critical.
“What was approved is a prospecting licence, which is not the same as a mining lease,” Hajiji said in his winding-up speech.
“A mining lease would only be granted after Cabinet-level discussions on matters like state equity, royalties and land terms — and we’re not there yet.”
The remarks were in response to Senallang assemblyman Datuk Seri Shafie Apdal, who raised concerns over a reported application for nearly 1,000 acres of land in Nagos — land which, he said, had been repossessed by the state during his administration due to its strategic value.
“I had cancelled all prior alienations and returned the land to the state because of its proximity to a water catchment and presence of valuable mineral dust. “If gold exists, let it be a state reserve so we can manage it ourselves,” he said.
Shafie, who served as chief minister from 2018 to 2020, warned that early-stage private involvement could lead to pressure for full mining rights down the line.
“My fear is once they invest, they’ll demand to mine. That’s why I placed it under agencies like Yayasan Sabah before.”
Hajiji defended the state’s approach as financially sound. Mineral exploration, he said, is highly technical, capital-intensive and carries no guarantee of success. Letting the private sector shoulder that risk made better financial sense for the state.
“This way, the government avoids liability, avoids spending, and keeps control over environmental standards and eventual revenue,” he said.
Additional details issued by the Chief Minister’s Department later confirmed that a single prospecting licence had been granted for the Nagos area.
However, it stressed that this did not grant permission to extract any minerals.
The department described the move as part of a “sound financial strategy and prudent risk management,” with all early-stage costs borne entirely by the private firm.
“By shifting the exploration risk to private hands, the state can maintain regulatory oversight and focus on ensuring long-term liquidity and returns,” the department said.
It added that a new state-owned entity — Sabah Mineral Management (SMM) — had been set up to monitor compliance, verify royalty payments, and enforce international ESG (environmental, social and governance) standards in any future mining operations.
“SMM will screen companies to ensure they have both the technical expertise and financial muscle for responsible exploration,” the department said. “It will also safeguard state interests through transparency, accurate declarations, and sustainable practices.”
Officials also gave assurances that no mining activity will be permitted unless and until further Cabinet approvals are obtained.
“All mining-related decisions will be subject to stringent environmental, fiscal and legal safeguards,” the department concluded. “Sabah’s natural resources must be protected not just for current development, but for future generations.” – April 16, 2025
