Tullow Oil SK Limited paid suppliers in 26 days on average — inside its 30-day stated terms

Standard payment terms

Tullow specifies payment period of 30 days from receipt of a true, correctly prepared and adequately substantiated invoice in all of its standard contract models. Tullow sometimes varies standard payment terms by reducing the payment period from 30 days to 15 days based on negotiations with suppliers and consultation with Finance. Tullow does not specify a maximum payment period in its model contracts, however Tullow provides for suppliers’ right to charge interest on any invoices overdue. Tullow does require that invoices be submitted within 3 months of the work qualifying for payment to ensure discipline.

Dispute resolution

Tullow reserves the right to dispute items on the invoice. Tullow changed its standard invoice dispute clause in 2018 so most newly entered contracts provide that Tullow will pay undisputed items on the invoice upon receipt of a new invoice for the undisputed portion and supplier’s credit note for the original disputed invoice in accordance with payment terms agreed in the contract. For a minority of contracts entered into in 2018 and for contracts entered into before 2018, Tullow undertakes to pay the undisputed items on the invoice upon receipt of a supplier’s credit note amending the original disputed invoice. Tullow also reserves the right to withhold disputed amounts from any money due under the contract. Suppliers then have a right to submit invoices for any money due once the disput