Portuguese energy major Galp has initiated international arbitration proceedings against the Mozambican Tax Authority (AT) to resolve a longstanding dispute over the taxation of its stake sale in the Rovu gas field.
The move marks a significant escalation in the conflict, which centers on the fiscal treatment of Galp's divestment of its 10% interest in Area 4 of the Rovuma Basin project.
The decision to seek arbitration follows months of unresolved disagreements between the Lisbon-based firm and Mozambican tax officials regarding the applicable tax liabilities on the transaction.
The arbitration filing introduces a layer of legal and regulatory risk for Galp's operations in Mozambique, a key jurisdiction for the company's natural gas portfolio.
While the immediate financial impact of the dispute remains unclear, the escalation could influence investor sentiment toward Galp's African assets and broader exposure to emerging-market fiscal regimes.
The case highlights the ongoing tensions between multinational energy firms and host governments over tax enforcement and revenue sharing in resource-rich jurisdictions.