Tullow is now worth less than the tax bill Ghana just won against it

Tullow Oil's worth has plummeted to less than three-quarters of a billion dollars, following a hefty US$393 million judgment Ghana awarded against the company this week. The verdict consists of a US$196.5 million corporate income tax assessment, plus an equal penalty amount. Former Finance Minister Dr Cassiel Ato Forson confirmed the figure on Tuesday, explaining that it resulted from the Ghana Revenue Authority assessing Tullow Ghana Limited for US$196.5 million in corporate income tax on earnings from their business interruption insurance policy over 2016 to 2019 fiscal years, followed by a 100% penalty.

The ruling, issued by a tribunal under the International Chamber of Commerce rules, invalidated the 100% penalties, deeming them outside the scope of Tullow's petroleum agreements with Ghana. Consequently, the tribunal also ruled that the assessment itself wasn't against the petroleum agreements, time-barred, and that the GRA's enforcement was legal.

Tullow expressed disappointment and will evaluate its next steps after further discussions with the government, causing its shares to plunge by up to 52% in London, leaving the company valued at roughly US$200 million, which is half the award amount.

Tullow is grappling with US$1.4 billion in debt and reported a US$101 million loss after tax in the first half of 2026. Analyst Ashley Kelty from Panmure Liberum stated that the outcome was expected, but noted that unless Tullow makes significant progress in paying down debt, its long-term survival is questionable. The government, however, aims to secure revenue while maintaining Tullow's ability to continue operating and investing in the Jubilee and TEN fields.

Tullow plays a crucial role in Ghana's petroleum sector, being the largest producer and operating the Jubilee and TEN fields, which are vital for domestic gas supply and employ a significant portion of the workforce. The government is currently negotiating to extend the field's agreements to attract new investment. The week's decision also evened a longstanding score in Tullow's favor - in January 2025, an ICC tribunal previously ruled that Branch Profit Remittance Tax did not apply to Tullow's operations in the Deepwater Tano and West Cape Three Points fields, resulting in a US$320 million award for Ghana.