Heritage pays up Shs871b to Tullow oil, eyes appeal
Posted Monday, November 4 2013 at 02:00
Kampala- Tullow Oil PLC (Uganda) has said that Heritage Oil has completed payments of all monies owed to it, including the interest rates as ordered by court.
The British oil company told this newspaper last week, that Heritage has fully paid back $345 million (about Shs871 billion) of the indemnity claim of $313 million (about Shs790 billion) paid to Uganda.
Tullow Uganda subsidiary’s communications officer, Mr David Onyango, noted: “Heritage has paid Tullow the full amount plus costs, which represents the full amount owed following the court ruling in our favour.”
Tullow is one of the three, with France’s Total E&P and China’s China National Offshore Oil Corporation (Cnooc), approved companies operating in Uganda.
After announcing its intention in 2010 to transfer its petroleum assets in the Albertine belt to Italian oil company ENI, Heritage maintained that the transaction was not taxable in Uganda and thus objected to any payments.
Upon declaration, Uganda Revenue Authority (URA) also demanded a 30 per cent of the $1.45 billion (about Shs3.7 trillion) deal as capital-gains tax before the transaction was approved but Heritage declined and demanded that the matter be settled at the International Court of Arbitration in London, where the ruling was made in Tullow’s favour.
Mr Onyango earlier said: “Heritage had been ordered to satisfy its debt by paying $283 million (Shs715 billion) immediately to Tullow with the balance $60 million (Shs153 billion) to be paid not later than August 26 this year.
However, Heritage has since appealed against the rulings and a second stage of hearing has been set.
The company, after the ruling in a statement, expressed discontentment at what it said was Uganda’s breach of confidentiality imposed upon both parties to the proceedings and noted that Wednesday’s decision only marked the end to a “preliminary” phase of the international arbitration process.
In another statement, Heritage indicated: “Court [in London] has set the dates of December 4 and 5 for the second hearing of tax disputes between Heritage Oil and the Government of Uganda.”
Attempts to speak to the Attorney General, Mr Peter Nyombi, were futile by press time.