Heritage To Pay 30% Of $404M Tax On Tullow Deal Now-Uganda Min

6th Jul 2010 14:42

By Nicholas Bariyo and James Herron Of DOW JONES NEWSWIRES KAMPALA, Uganda (Dow Jones)--Heritage Oil Ltd. (HOIL.LN) has agreed to pay upfront 30% of the disputed $404 million capital gains tax bill on the sale of its Uganda assets to Tullow Oil PLC (TLW.LN), Ugandan Energy and Minerals Minister Hilary Onek said Tuesday. It will also seek a bank guarantee of the remaining 70% pending the result of arbitration on the tax dispute, Onek said. "We have approved the sale on condition that Heritage Oil deposits 30% of the assessed capital gains tax on the transaction with the Uganda Revenue Authority," Onek told Dow Jones Newswires. "We have also asked Heritage to seek bank a guarantee of the remaining 70% of the tax which government can access on demand as the arbitration on the tax dispute continues," he said. The long-delayed approval of the transaction clears Tullow to continue with preparations to bring on Total SA (TOT) and China National Offshore Oil Co. Ltd. (CEO) as partners for the development of oil discoveries in three blocks in the Lake Albert basin, Onek said. -By Nicholas Bariyo and James Herron, Dow Jones Newswires; +44 (0)20 7842 9317; [email protected] (END) Dow Jones Newswires July 06, 2010 09:42 ET (13:42 GMT)