Saturday 19 August 2017

Tullow sues over €220m tax bill

Thomas Molloy

Thomas Molloy

TULLOW Oil has sued its former partner in Uganda to recover $313m (€220m) which the Dublin-listed company paid to cover tax on fields it bought from Heritage.

Tullow says Jersey-based Heritage Oil is liable for capital gains taxes on the sale. Heritage, led by former mercenary boss Tony Buckingham, denies the claim.

Tullow paid the Ugandan government the $313m to secure approval of the change in field ownership, and is now seeking to get the money back from Heritage through the High Court in London.

"Tullow has a duty to its shareholders to seek reimbursement and shift liability back to Heritage," a spokesman told Reuters.

Uganda's tax authorities say the money is for tax owed on last year's $1.45bn cash sale of Heritage's interests in two blocks of oil and gas lands to Tullow. Heritage disputes that Uganda is entitled to tax the transaction and says Tullow had no authority to pay the government compensation.

Heritage said it was seeking the release of over $283m it placed in escrow pending the outcome of arbitration with Kampala over the tax claim.

Irish Independent

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