In 1999 state election, the opposition has took control of Terengganu after BN loss its majority votes. A year later in September 2000, the then Malaysia Prime Minister Dr. Mahathir Mohammad ordered PETRONAS to rescind the royalty payments on the ground that the federal government (BN) did not have confidence on state government (PAS) in managing the fund.
March 2001, PAS-led state government of Terengganu has filed a lawsuit in the high court insisting that federal government's decree to stop the royalty payment is illegal based on exclusive agreement between PETRONAS and state.
When BN took over Terengganu in 2005, they want to reinstate back the royalty payment in 2009, but the disagreements remained. Much of these revolved around federal government's special compensation scheme to the state called 'Wang Ehsan'. Of course, the wang ehsan paid to Terengganu now is much lower than the actual value Terengganu could get by 5%.
Last March 31st, Terengganu government voluntarily dropped its 11-year legal suit against PETRONAS over the payment of royalties without any settlements. BN is so corrupt..rotten to grassroots.