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Hard times at Tullow Oil
Tullow’s latest tax bill of $450 million is $66 million higher than its 2011 bill, due to a “presumed amount for Ugandan capital gains tax”. The company has confirmed that this “presumed amount” is the $142 million capital gains tax that the firm paid upon the sale of two thirds of its Ugandan assets to the Chinese National Offshore Oil Company (CNOOC) and Total for $2.9 billion.
The Ugandan Revenue Authority demanded a $473 levy on the deal, though Tullow have predictably disputed this. According to Ugandan law, 30% of that fee is required to dispute the assessment and so Tullow have paid $142 million to escalate the incident, with a decision expected to be made later in 2013.
Tullow is also fighting a second capital gains tax dispute in London with another oil firm in an attempt to recover capital gains charges it paid after acquiring the oil firm’s Ugandan assets for $1.35 billion.
Additionally in Uganda, Tullow is locked in another tax dispute with the government after VAT was placed on machinery the firm imported into the country. This case has been filed in the International Centre for Settlement of Investment Disputes (ICSID), the World-bank created institution based in Washington.
These woes add to the pressure mounting on Tullow’s CEO and founder, Aidan Heavey, to step down; despite his steady tenure over the years, there are real concerns that he is not the man to turn the firm into the oil producer it is aspiring to be.
The Ugandan Revenue Authority demanded a $473 levy on the deal, though Tullow have predictably disputed this. According to Ugandan law, 30% of that fee is required to dispute the assessment and so Tullow have paid $142 million to escalate the incident, with a decision expected to be made later in 2013.
Tullow is also fighting a second capital gains tax dispute in London with another oil firm in an attempt to recover capital gains charges it paid after acquiring the oil firm’s Ugandan assets for $1.35 billion.
Additionally in Uganda, Tullow is locked in another tax dispute with the government after VAT was placed on machinery the firm imported into the country. This case has been filed in the International Centre for Settlement of Investment Disputes (ICSID), the World-bank created institution based in Washington.
These woes add to the pressure mounting on Tullow’s CEO and founder, Aidan Heavey, to step down; despite his steady tenure over the years, there are real concerns that he is not the man to turn the firm into the oil producer it is aspiring to be.
- TAGS:
- heavey,
- breaking_news,
- tax_dispute,
- tullow,
- tullow_oil,
- icsid,
- uganda
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