The Federal Government of Nigeria has announced a set of fiscal incentives aimed at revitalizing the nation’s upstream and downstream sectors in the oil and gas industry.
The measures were revealed by the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, on Wednesday.
The new incentives include the Value Added Tax (VAT) Modification Order 2024 and the Notice of Tax Incentives for Deep Offshore Oil & Gas Production, as part of the Oil & Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order 2024. These initiatives are designed to improve the operating environment for energy companies while encouraging investments.
A statement from Mohammed Manga, Director of Information and Public Relations at the Federal Ministry of Finance, detailed the VAT exemptions for critical energy products and infrastructure. Items such as diesel, feed gas, liquefied petroleum gas (LPG), compressed natural gas (CNG), electric vehicles, liquefied natural gas (LNG) infrastructure, and clean cooking equipment are now VAT-exempt.
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“These measures are intended to lower living costs, enhance energy security, and accelerate Nigeria’s shift to cleaner energy sources,” Manga said.
Additionally, new tax reliefs for deep offshore projects were introduced to position Nigeria’s deep offshore basin as a key destination for global oil and gas investments.
The reforms are part of President Bola Ahmed Tinubu’s broader economic strategy, aligned with Policy Directives 40-42. The government’s focus is on driving investment, supporting sustainable growth in the energy sector, and enhancing Nigeria’s competitiveness in the global oil and gas market.
“These fiscal incentives reaffirm the administration’s dedication to fostering sustainable growth, boosting energy security, and driving economic prosperity for Nigerians,” the statement concluded.
