KUALA LUMPUR (BLOOMBERG) - The Malaysian government will not entertain any territorial claim by any party over the Borneo state of Sabah, Prime Minister Ismail Sabri Yaakob said in a statement on Friday (March 18).

The announcement comes after recent claims and arbitration proceedings by the French Arbitration Court in Paris that ordered the Malaysia government to pay RM62.59 billion (S$20.18 billion) to a group calling itself the descendants of the sultanate of Sulu.

The Sulu Sultanate leased Sabah to a British company in 1878 and the state was later absorbed into Malaysia.

They ruled the islands in the Sulu Archipelago, which are parts of Mindanao in today's Philippines.

The claims are "illegal and in violation of the law", Datuk Seri Ismail said on Friday, adding that the Malaysian government had filed an application to cancel the award on March 3 at the court in Paris.

"The Malaysian government takes the issue of national sovereignty seriously, including the sovereignty and integrity of Sabah in Malaysia," Mr Ismail said.

The United Nations and the international community have recognised Sabah as being part of the Malaysian Federation since Sept 16, 1963, Mr Ismail added.

Sabah is situated in the northern portion of Borneo island close to the Philippines.

Besides being a popular tourist spot with beaches and diving sites, the state is rich in natural resources such as oil and gas with investments from the likes of Shell and ConocoPhillips.

Sabah is also Malaysia's biggest palm oil producing state, making up about 24 per cent of total crude palm oil output. Malaysia is the world's second-biggest palm oil grower.