Videocon to take heat of Mozambique tax norms
Several oil and mining majors have been looking to invest in Mozambique, which is expected to become one of the world’s leading coal and gas exporters.
State-run refiner Bharat Petroleum (BPCL) also holds a 10% stake in the Rovuma basin, which is operated by US-major Anadarko Petroleum. BPCL said in a notice to the BSE on Friday that Anadarko has signed a heads of agreement (HOA) with Italy’s Eni, the operator of another block in Mozambique, for the coordinated development of common natural gas reservoirs in what it called a “significant step in achieving the target of first LNG cargo by 2018.”
A top BPCL official said the change in tax laws won’t impact the company as it has no plans to sell the asset in the near future.
Mozambique is seeking to derive a bigger share of profits from its mineral wealth, as it faces criticism over granting huge tax breaks to foreign firms to attract investment after a civil war which ended in 1992.
“This obviously will have some impact on sentiment. These companies are probably not going to be happy, but from the government’s point of view they can make significant money from their natural wealth,” Arvind Mahajan, a partner at KPMG India said.
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