Tullow Oil’s shares have experienced a significant surge following a favorable ruling in a high-profile tax arbitration case in Ghana.
The oil and gas company saw its stock price jump over 14% after the International Chamber of Commerce (ICC) ruled in its favor, exempting it from a $320 million tax liability.
The dispute centered around the Branch Profit Remittance Tax (BPRT) applied to Tullow Oil’s operations in Ghana, particularly in the Jubilee and TEN fields, which have been key to the company’s production in the West African nation.
The ICC ruling confirmed that the BPRT would not apply to Tullow’s operations in these fields, effectively removing a significant financial burden for the company.
Tullow Oil has long been involved in a tax dispute with the Government of Ghana, with the company challenging a tax demand over its Ghanaian operations dating back several years. The favorable arbitration outcome now clears the path for the company to move forward without the looming threat of a $320 million tax penalty.
Tullow Oil’s shares surge
Following the news of the arbitration success, Tullow Oil’s shares surged to the top of the FTSE small-cap index, a major boost after a difficult year for the company.
Tullow’s stock price had previously dropped nearly 45% in 2024 amid a series of financial and operational challenges. However, the positive outcome has revived investor confidence and highlighted the company’s ability to overcome significant hurdles.
In a statement, Tullow Oil expressed its satisfaction with the ruling and acknowledged the collaborative work with the Ghanaian authorities. The company emphasized its commitment to resolving the remaining tax disputes, with two other unresolved claims still under negotiation.
Despite this success, Tullow remains focused on its ongoing engagement with the Government of Ghana to find mutually acceptable solutions to the other disputed tax issues. This includes efforts to maintain a stable and productive relationship in the country, where Tullow has operated for many years.
Analysts have expressed optimism about the future of Tullow Oil, noting that the arbitration victory could serve as a turning point in the company’s fortunes. With the tax uncertainty now behind it, Tullow is expected to focus on growth and capitalizing on its strong offshore oil assets in Ghana.
The company’s rebound in stock value and the successful resolution of this critical issue mark a significant achievement for Tullow Oil as it seeks to regain momentum and rebuild its reputation in the energy sector.
About Tullow Oil
Tullow Oil is an independent oil and gas exploration and production company headquartered in London, with operations in several countries across Africa, South America, and Asia.
It is particularly well-known for its presence in Ghana, where it has been a major player in offshore oil production for over a decade.
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