Albania warns oil firm Bankers not to curtail output in tax row

Tue Dec 1, 2015 3:49pm EST
 
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TIRANA Dec 1 (Reuters) - The Albanian government warned Canadian oil company Bankers Petroleum on Tuesday not to curtail its operations, as a row over taxes escalated.

Bankers, which has been extracting oil for 11 years in Albania, said on Monday it had been forced to consider phasing down its operations because Albania had failed to comply with an order by International Chamber of Commerce Tribunal (ICC) to revoke a suspension on the company's bank accounts.

The bank accounts were frozen by the tax department to collect $75 million dollars, more than the $57 million it originally demanded, due to accrued interest and penalties.

In a statement the government said it reserved "all of its options and is aware of its obligation to preserve the long-term integrity of its treasured national asset".

"All companies working in Albania, whether foreign or domestic, must abide by the laws and regulations of the Republic of Albania," it said, without specifying what action it would take if Bankers curtailed its operations.

"While the government welcomes foreign and local partners, the natural resources of Albania are the patrimony of the people and should not be mismanaged or used as threats against the nation," Prime Minister Edi Rama's office said in the statement.

The government and Energy Minister Damian Gjiknuri also did not say whether they would allow Bankers access to its banks accounts.

The row stems from an audit of Bankers' 2011 books by the local oil watchdog that disputed some $250 million of costs, triggering a $57 million dollars profit tax. An output sharing contract allows Bankers to recover costs before paying profit tax.

Bankers said last week if Albania complied with the ICC order the company would be able to operate as usual while the ICC process and third-party cost recovery audit ran their course. (Reporting By Benet Koleka, Editing by Susan Thomas)