Heritage Oil Plc

Heritage Oil Plc

November 24, 2011 08:11 ET

Heritage Oil Provides an Update on Ugandan Tax Dispute

LONDON, UNITED KINGDOM--(Marketwire - Nov. 24, 2011) -


Heritage Oil Plc ("Heritage" or the "Company") (TSX:HOC)(LSE:HOIL), an independent upstream exploration and production company, has considered the ruling dated 23 November 2011 of the Tax Appeals Tribunal in Uganda dismissing the application of its wholly-owned subsidiary Heritage Oil & Gas Limited ("HOGL"). HOGL had challenged the Ugandan tax assessments on the disposal of HOGL's entire interests in Blocks 1 and 3A to Tullow Uganda Limited in July 2010 (the "Sale").

HOGL has at all times disputed the jurisdiction of the Ugandan Courts and Tribunals, in view of the existence of valid and binding arbitration provisions in its Production Sharing Agreements ("PSAs") with the Government of the Republic of Uganda ("Government"). Furthermore, in the light of specialist advice received in Uganda, North America and the United Kingdom, Heritage and HOGL remain of the view that no tax was due or owing on the Sale. HOGL initiated arbitration proceedings in London with Government in May 2011 and has always maintained that this is the correct forum to settle disputes relating to the Sale.

As a result of the actions of the tax authorities in Uganda, HOGL and its advisers consider that it was compelled to take part in the Ugandan domestic process before the Tax Appeals Tribunal, notwithstanding HOGL's belief that arbitration, which is ongoing in London, is the correct forum to settle such disputes. The ruling from the Tax Appeals Tribunal in Uganda is part of the domestic process and is not final and determinative. HOGL 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.

Paul Atherton, Chief Financial Officer, commented:

"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. We instigated arbitration in London as provided for in the PSAs 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."

Notes to Editors

  • Heritage is listed on the Main Market of the London Stock Exchange and is a constituent of the FTSE 250 Index. The trading symbol is HOIL. Heritage has a further listing on the Toronto Stock Exchange (TSX:HOC).

  • Heritage is an independent upstream exploration and production company engaged in the exploration for, and the development, production and acquisition of, oil and gas in its core areas of Africa, the Middle East and Russia.

  • Heritage has a producing property in Russia, exploration projects in the Kurdistan Region of Iraq, the Democratic Republic of Congo, Malta, Pakistan, Tanzania and Mali and an investment in Libya.

  • All dollars are US$ unless otherwise stated.

  • For further information please refer to our website, www.heritageoilplc.com.

If you would prefer to receive press releases via email please contact Jeanny So (jeanny@chfir.com) and specify "Heritage press releases" in the subject line.


Except for statements of historical fact, all statements in this news release - including, without limitation, statements regarding production estimates and future plans and objectives of Heritage - constitute forward-looking information that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from those anticipated in such statements. Factors that could cause actual results to differ materially from anticipated results include risks and uncertainties such as: risks relating to estimates of reserves and recoveries; production and operating cost assumptions; development risks and costs; the risk of commodity price fluctuations; political and regulatory risks; and other risks and uncertainties as disclosed under the heading "Risk Factors" in its Prospectus and elsewhere in Heritage documents filed from time-to-time with the London Stock Exchange and other regulatory authorities. Further, any forward-looking information is made only as of a certain date and the Company undertakes no obligation to update any forward-looking information or statements to reflect events or circumstances after the date on which such statement is made or reflect the occurrence of unanticipated events, except as may be required by applicable securities laws. New factors emerge from time to time, and it is not possible for management of the Company to predict all of these factors and to assess in advance the impact of each such factor on the Company's business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking information.

Contact Information