Sunday, 20 March 2022 06:00

How govt will earn from oil, gas sector

What you need to know:

  • Income. Government has provided a number of taxes under the Income Tax Amendment Bill through which Uganda will earn from the oil and Gas sector as a country.  

Now that the oil development stage has started, it is easier to connect the dots on how the private sector will directly benefit from the resource. 

A number of contracts have been drawn while hundreds or even thousands of others, are still in the pipeline. 

However, beyond individual or company level benefits, the question is; how does Uganda, as a country, earn from the oil and gas sector?

Pamela Natamba is the head of oil and gas division at PricewaterhouseCoopers (PwC). 

In her assessment, as a country, during the development stage, Uganda will mainly earn through taxes, given that there will be no commercial production until 2025. 

Therefore, she notes, such earnings have been provided for in the Income Tax Amendment Bill, which particularly focuses on the oil and gas sector. 

“That Bill has made specific provisions, but one of them which is very interesting is it introduces a Windfall Tax,” she says and notes that this tax will apply to licensees that have signed Petroleum Sharing Agreements, many of which have been involved in exploration up to the point of production. 

These, she says, include large companies such as TotalEnergies, CNOOC and Uganda National Oil Company (UNOC), among others. 

What the Bill puts in place, Natamba says, is that as long as you earn revenue in excess of a certain amount, you will be subjected to a Windfall Tax. 

For instance, she explains, if international oil prices are expected to go for a certain amount you a company sells beyond what has been projected, the expectation is, the company will pay an extra tax over and above 30 percent. 

 

Published in Energy
Wednesday, 12 June 2019 08:22

Court refuses to block Kiruddu sewage plant

 

Kampala. Court has dismissed an application seeking to block a government entity from constructing a sewage treatment plant to mitigate the irritating stench at Kiruddu Hospital in Kampala.
On May 5, the Assistant Registrar of the High Court Land Division, Ms Justine Atukwasa, ruled that the construction of a sewage treatment plant is meant for the greater good of the wider public which should not be stopped.
The registrar added that if in its final judgment court finds that Mr Steven Lwanga, who is claiming ownership of part of the land is the rightful owner, he can be compensated.

“The question would be what is the threat here that would render the applicant’s main application and the matter nugatory that it cannot be addressed through the award of damages? I do not find any such threat. He still has remedies at disposal including compensation for his equitable interest,” Ms Atukwasa ruled. 
She continued: “In conclusion, therefore, bearing the above consideration in mind, I have come to the finding that this is not a fit and proper case for the application of interim injunction to be granted.”

The registrar further explained that court declined to issue a temporary injunction against government halting the construction of the sewage plant because it does so only in compelling circumstances.
Mr Emmanuel Ainebyoona, the spokesperson of the Ministry of Health, said following the court ruling, they are waiting for the National Water and Sewerage Cooperation to commence the construction of the treatment plant.
“This land was given to the ministry by Buganda Land Board which promised to sort out all third party claimants. So, we are now waiting for the National Water and Sewerage Cooperation to commence the construction of the waste treatment plant,” Mr Ainebyoona said yesterday.

In his petition, Mr Lwanga had sought for an interim injunction blocking Buganda Land Board (BLB) and Kampala Capital City Authority (KCCA) or their agents from further trespassing on the contested land measuring 2.75 acres in Valley Zone, Salama Parish in Makindye Division where the treatment plant is set to be constructed until his main case has been concluded to determine his claim of ownership.
Mr Lwanga is claiming the land which was also formerly claimed by a one Serufusa who acquired it from Prince Richard Nakibinge of Kabaka, Sir Daudi Chwa lineage.
In February this year, following complaints from the residents about the terrible stench at Kiruddu Hospital, government and BLB negotiated to acquire the 2.5 acre land to build a sewage treatment plant to remedy the problem.

The BLB offered a lease to government through KCCA. Early this year, the area MP Allan Ssewanyana and the residents held a demonstration to protest the stench. Police arrested the MP.
Once the treatment plant is completed, the sewage from the hospital will be channelled directly to the plant since the current septic tanks cannot contain the huge sewage discharge from the hospital.

 
 

Credit: Daily Monitor

Published in Media
 

Former South African president Jacob Zuma on Friday withdrew from testifying to an inquiry into corruption under his rule, citing biased treatment and harsh questioning.
In the corruption scandal popularly referred to as "state capture", Zuma is accused of overseeing mass looting of state assets during his nine-year tenure.

"We are here today to say that we will take no further part in these proceedings," Zuma's lawyer Muzi Sikhakhane told the inquiry commission in Johannesburg.
"Our client from the beginning... has been treated as someone who was accused."
An agitated Sikhakhane said the inquiry had become "a political process," drawing loud clapping and cheering from Zuma loyalists in the public seats at the inquiry.

Zuma, who started testifying on Monday, had dismissed all accusations made against him by previous witnesses to the inquiry.
He was due to give a final day of evidence on Friday after the inquiry was adjourned on Wednesday when he complained that the questioning was effectively a court cross-examination.
Zuma was ousted by the ruling ANC party in 2018 and replaced by his deputy, Cyril Ramaphosa, who has vowed to clean up the government.
On the first day of his testimony, Zuma gave a rambling address saying he was the victim of conspiracies and years of "character assassination", and accusing foreign intelligence agencies and spies of working against him.

He also said he had received multiple death threats and attempts on his life.
The former president, 77, later replied to many questions at the inquiry by saying he did not remember or was unaware of meetings and conversations that other witnesses had mentioned.

Possible prosecutions 
Zuma was not legally summonsed to attend the inquiry, but was invited to reply after being implicated in graft by several previous witnesses.
"I expected that he would cooperate, which he did by agreeing to come," said judge Raymond Zondo, who is chairing the inquiry.
"The first purpose was to give him an opportunity to tell his side of his story."

The inquiry is investigating a web of deals involving government officials, the wealthy Gupta business family and state-owned companies.
The Indian-born Gupta brothers -- Ajay, Atul and Rajesh -- have left South Africa and are now based in Dubai.
One witness, former finance minister Nhlanhla Nene testified that Zuma pushed policies on nuclear power and aviation that were designed to benefit the Gupta family.
"Mr Zuma and his legal team are in effect asking to be excused from the application of the rules," the inquiry's lead lawyer Paul Pretorius said.
"If the questions are detailed and if the questions and difficult... so be it.

 
 
 Source: Daily Monitor
 
Published in Politics