Table of Contents
Key Points
- Tullow Oil wins $320 million tax arbitration case, confirming its exemption from Branch Profit Remittance Tax in Ghana's Petroleum Agreements.
- CEO Rahul Dhir expresses confidence in the ruling, emphasizing a renewed focus on the Jubilee and TEN oil fields in Ghana.
- Samuel Dossou-Aworet's stake in Tullow Oil rises, boosting his net worth to over $70 million, despite a 2024 dip.
Tullow Oil Plc, a London-headquartered multinational oil and gas exploration company in which Gabonese oil magnate Samuel Dossou-Aworet holds a significant stake, has secured a major victory in a tax arbitration case.
An international tribunal ruled that the company is not liable for a $320 million tax assessment levied by the Ghana Revenue Authority. The ruling pertains to Tullow's operations under the Deepwater Tano and West Cape Three Points Petroleum Agreements, which include Ghana's key Jubilee and TEN oil fields.
In a press release on Thursday, Jan. 2, Tullow disclosed that the International Chamber of Commerce (ICC) Tribunal determined that the Branch Profit Remittance Tax (BPRT) does not apply to Tullow Ghana. The Tribunal affirmed that BPRT falls outside the tax regime outlined in the Petroleum Agreements.
CEO confirms confidence in agreements
This outcome absolves Tullow Ghana from the $320 million assessment and removes future exposure to similar claims under these agreements. Tullow continues to engage with the Ghanaian government on two remaining tax disputes, which were referred to the ICC in February 2023, with the aim of reaching mutually acceptable resolutions.
Commenting on the decision, Tullow Chief Executive Officer Rahul Dhir said: “We are delighted with the outcome and decision of the Tribunal, which affirms our assessment and removes a material overhang from our business. We have continuously had confidence in the sanctity of our Petroleum Agreements and the dispute resolution process, which has now brought certainty to all parties.”
He added: “I look forward to constructive discussions with the Government of Ghana to resolve the remaining claims so that our collective focus remains on maximising value from the Jubilee and TEN fields”.
Tullow shares surge after arbitration win
The arbitration win has sparked a rally in Tullow Oil’s shares on the London Stock Exchange, with prices surging nearly 15 percent in the past 48 hours. This recovery has pushed the company’s market capitalization beyond $440 million, offering a reprieve to shareholders who endured a more than 35 percent decline in the company’s market value during 2024.
For Samuel Dossou-Aworet, who celebrated his 80th birthday with family on Christmas Day 2024, the ruling has led to a significant boost in the value of his 16.8 percent stake in Tullow Oil. His holdings, comprising 243,635,633 shares, are now valued at over $70 million, a marked improvement though still below their September 2024 peak of $86 million.
Dossou-Aworet rises as African oil billionaire
Dossou-Aworet, founder of Petrolin Group, has built a legacy in Africa’s oil and gas sector since 1992, driving major deals across the continent. His Pan-African approach and strategic alliances have positioned him among Africa’s rising billionaires.
In 2024, Petrolin teamed up with Waltersmith Group, ND Western, First E&P, and Aradel Energy to form the Renaissance consortium, bidding $2.4 billion for Shell Plc’s onshore oil business in Nigeria. The deal, facing some regulatory hurdles, is poised to reshape Nigeria’s oil industry as Shell scales back operations in the Niger Delta.
