Ghana Wins $393m Tax Arbitration Against Tullow Oil.
Ghana Wins $393m Tax Arbitration Against Tullow Oil
Ghana has come out on top in a major tax dispute with oil producer Tullow Oil, after an international tribunal dismissed every claim the company brought against the country.
At the heart of the case was a US$393.09 million tax assessment issued by the Ghana Revenue Authority (GRA), and the tribunal upheld it in full. Finance Minister Dr. Ato Forson shared the outcome in a statement issued on September 30.
According to the tribunal’s findings, the assessment did not breach Ghana’s Petroleum Agreements with Tullow. It also concluded that the penalty applied by GRA was proper, that the assessment wasn’t time-barred, and that GRA’s enforcement action was entirely lawful.
The Tribunal ruled in favour of Ghana. It dismissed all claims brought by Tullow and upheld in full the Ghana Revenue Authority’s tax assessment of US$393,091,993.70, the statement said, adding that the assessment did not breach the Petroleum Agreements, the penalty was properly applied, the assessment was not time-barred, and the Ghana Revenue Authority’s enforcement action was lawful.
Ato Forson took time to acknowledge the effort that went into defending Ghana’s position, thanking the Office of the Attorney-General, the GRA, and Ghana’s external legal counsel, Foley Hoag LLP, for their work throughout the case.
For government, this ruling carries weight beyond just the money involved. It reinforces a broader principle that no company operating in Ghana, regardless of size or influence, sits outside the country’s laws.
This outcome vindicates the position Ghana has maintained throughout: that every company operating in this country, regardless of its size, is subject to the laws of Ghana, Ato Forson said.
Government noted that this ruling lands at a moment when Ghana and its Jubilee partners are actively working to maximise output from the Jubilee and TEN fields, making the case’s resolution particularly relevant to ongoing operations.
Interestingly, even before the tribunal’s decision came through, Ghana had already been in discussions with Tullow aimed at resolving outstanding tax matters amicably. Government confirmed those conversations will continue, covering both the issue the tribunal just ruled on and a separate, ongoing proceeding concerning the disallowance of loan interest.
The discussions are ongoing and would be resolved in the mutual interest of both parties, the statement added.
Even with this legal win, government was careful to frame Tullow as an important partner rather than an adversary. The company remains Ghana’s largest petroleum producer, and its work on the Jubilee and TEN fields plays a direct role in supporting the country’s energy security, domestic gas supply, and thousands of Ghanaian jobs.
Because of that, government said it intends to work with Tullow to implement the tribunal’s award in line with Ghanaian law, while being mindful of keeping operations in both fields running smoothly.
In doing so, the Government will have due regard to the continuity of operations in the Jubilee and TEN fields and Tullow’s capacity to sustain the investments required in those fields, Ato Forson noted.
Government pointed out that Ghana’s laws give GRA the authority to determine the timing and structure of how assessed tax liabilities get paid. The stated goal is finding the right balance securing the revenue owed to Ghanaians, while still preserving Tullow’s ability to keep operating and investing in the country going forward.
