The Ugandan Ministry of Energy and Minerals will hold a signing ceremony this afternoon with London-listed Tullow Oil that will resolve a long-standing tax dispute that has held up oil and gas development in the country.
The dispute relates to a $283 million capital gains tax bill that Uganda has said should be paid by Tullow’s former partner Heritage Oil.
Tullow acquired 100% of the Ugandan licenses after it bought out its former partner Heritage Oil for $1.45 billion last year.
The dispute has held up a plan by Tullow to farm out a stake in its Uganda properties to French super major Total and China National Offshore Oil Company.
Last week, a senior Uganda energy official told Dow Jones that the two sides had reached an agreement on the dispute, but declined to discuss the details.
Uganda’s management of its oil industry became a flashpoint in the recent presidential election, with President Museveni repeatedly declaring that Uganda wouldn’t allow the wishes of foreign oil producers to have greater priority than the wellbeing of the Ugandan public.
Museveni won the 18 February election with a 68% of the vote.
