Oil and gas firm Heritage Oil took a tumble on Thursday after a Ugandan tribunal ruled against it in its tax dispute with the Ugandan government.
Clinging on to the hope that it could yet win its case and save itself a pile of money, the company noted that the ruling from the Tax Appeals Tribunal in Uganda is part of the domestic process and is not final and determinative.
Heritage said it will appeal the ruling, which it believes is fatally flawed in many respects, through the Ugandan court system commencing with the High Court and subsequently the Court of Appeal and Supreme Court if necessary.
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"Given the publicity this case has generated in Uganda, it was always going to be difficult for the tribunal to rule against Government but we believe firmly in our position that no tax was due in Uganda as a result of the sale of Blocks 1 and 3A," said Paul Atherton, chief financial officer of Heritage, in reference to the tax that the Ugandan government says Heritage is liable to pay on the proceeds of its disposal of some Ugandan assets.
"We instigated arbitration in London as provided for in the PSAs [production sharing agreements] as we consider this to be the appropriate avenue and that process is ongoing. We will also continue to vigorously pursue all legal forums open to us against this fundamentally flawed ruling," Atherton said.
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