Oxy acquisition of Anadarko: Mozambique expects to determine capital gains tax this year

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Oxy acquisition of Anadarko: Mozambique expects to determine capital gains tax this year

3:57 CAT | 16 Aug 2019

Picture: O País

The Mozambican government said yesterday that tax experts are ascertaining the capital gains tax that the state will collect from the acquisition of US oil company Anadarko by Occidental, adding that the calculation process is to be completed this year.

US oil company Occidental Petroleum announced this month that it has bought its rival Anadarko, the company that leads one of the largest natural gas projects underway in Mozambique, for US$55 billion (€49 billion).

Reacting yesterday to the deal between the two companies, Mozambique’s Minister of Mineral Resources and Energy, Max Tonela, said that “at the tax level, technical teams from the Mozambique Tax Authority (AT) and the National Petroleum Institute (INP) are working with experts from Occidental in order to determine the value of capital gains.”

Tonela referred to the impact of the deal between Anadarko and Occidental while speaking to journalists on the sidelines of the Ministry of Mineral Resources and Energy Coordinating Council meeting in Chibuto, Gaza province, southern Mozambique, yesterday.

The calculation of the amount that the Mozambican state will collect from the operation between the two multinationals will be completed later this year.

Max Tonela said Anadarko and Occidental have already given assurances to the Mozambican government that the deal between the two oil US oil majors will have no negative impact on the development of the Area 1 natural gas exploration project in the northern Rovuma Basin.

“All staff will be maintained and all financial and commercial commitments that make the project viable observed,” he said.

The Mozambican Minister of Mineral Resources and Energy noted that Occidental had already told the Mozambican executive that it intended to sell some of the assets that it bought from Anadarko to French company Total.

After the merger is completed, Occidental will sell Anadarko’s African projects to France’s Total. These include Area 1 of the Rovuma Basin in northern Mozambique, an investment of U$25 billion.

Area 1 and Area 4 gas projects (the latter led by Exxon and Eni) are expected to place Mozambique in the top 10 of the world’s largest natural gas producers and accelerate economic growth, with projected yearly rates of 7% to 10%.

Source: Lusa