Heritage Oil Plc

Heritage Oil Plc

March 30, 2011 10:00 ET

Heritage Oil Provides Uganda Update

LONDON, UNITED KINGDOM--(Marketwire - March 30, 2011) -


Heritage Oil Plc (TSX:HOC)(LSE:HOIL), an independent upstream exploration and production company, notes the recent announcement by Tullow Oil plc ("Tullow") relating to Tullow's operations in the Republic of Uganda ("Uganda") (the "Announcement") and makes the following clarification.

Contained in the Announcement is a statement by Tullow that: "In line with Ugandan dispute resolution procedures under the Uganda Income Tax Act, US$121 million was paid to the URA and Tullow and Heritage agreed to deposit US$283 million into an escrow account in London pending resolution of the dispute through a tax tribunal in Kampala."

As previously announced, Heritage's position, based on comprehensive advice from leading tax experts in Uganda, the United Kingdom and North America, is that the sale of Heritage's Ugandan interests to Tullow, which completed in July 2010, is not taxable in Uganda. On 26 July 2010, when the sale completed and funds were received, Heritage deposited US$121.5 million with the Uganda Revenue Authority ("URA") and deposited US$283.4 million in an escrow account at Standard Chartered Bank in London.

Following the Announcement, Heritage is reviewing its options to resolve this tax dispute, including commencing arbitration proceedings to reclaim the monies deposited in escrow in London and on deposit with the URA, totalling US$404.9 million. The production sharing agreements for Blocks 1 and 3A state arbitration proceedings will be held in London.

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 and exploration projects in the Kurdistan Region of Iraq, the Democratic Republic of Congo, Malta, Pakistan, Tanzania and Mali

  • All dollars are US$ unless otherwise stated

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

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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. 

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