Kenyan, Ugandan Contractors Earn Over $100 million in payments from Tullow Oil – Report Highlights

2,240 suppliers working directly for Tullow in Uganda, Kenya and Ghana took home $255M of the total  $1.4 billion Spent with suppliers in 2014 according to the latest Corporate Responsibility report by Tullow Oil.

Of this amount contractors in Kenya received $81.5 million in payments signifying a doubling in spending while those in Uganda earned $20.3 million a flat growth from last year’s $19.6 million.

This amount does not include the value of local employment or goods and services secured through the company’s supply chain, or investments in social investment projects as part of Tullow’s contractual obligations.

This amount is on top of $518 million paid to the respective governments and $459 million in payments to employees in salaries and wages over the respective period. The payments to governments were lower in 2014 than in 2013 ($870 million) due to a reduction in payments in kind caused by lower production entitlements per barrel in West and North Africa and lower income taxes as a result of higher Norwegian tax rebates.

Specifically the Kenyan government received $41.45 million in payments including $158,000 from license fees and infrastructure improvements ($732,000). During the same time the company paid $17.9 million in withholding taxes and $817,000 in custom duties.

During the same period Uganda the payments were much lower at $16.1 million signifying the slowdown in activity in the country as well as the reduction in number of employees. This included $10.1 million in PAYE and national insurance while withholding tax and stamp duty stood at $1.9 and $2.6 million respectively.

In Kenya the company reports that its Kenyan personnel on permanent basis stands at 172 while those in Uganda were slightly lower at 106.

In Kenya specifically the company says that two-thirds of the sub-contractors were from the Turkana region.

Notably the company reports 15 uncontrolled releases of over 50 litres during the year including one large spill of 702,000 litres in Turkana, involving a septic tank leaking into a storm water pit, which then subsequently escaped into the surrounding area.

Author: OilNews

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