The Federal Government of Nigeria has introduced new tax exemptions to boost the oil and gas industry, aiming to stop the wave of divestments in the sector.
The announcement was made by the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, who said the new fiscal incentives are designed to revitalize the industry and attract fresh investments.
The tax exemptions were detailed in two key documents: the “Value Added Tax (VAT) Modification Order 2024″ and the *”Notice of Tax Incentives for Deep Offshore Oil & Gas Production.” These documents outline several tax relief measures in accordance with the *Oil & Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order 2024.
The VAT Modification Order includes tax exemptions on essential energy products and infrastructure such as diesel, feed gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), electric vehicles, Liquefied Natural Gas (LNG) infrastructure, and clean cooking equipment.
Additionally, the Notice of Tax Incentives for Deep Offshore Oil & Gas Production introduces new tax reliefs specifically for deep offshore projects, aiming to encourage investment in this area.
Mr. Edun expressed hope that these fiscal incentives would attract massive new investments, help lower the cost of living, and strengthen energy security. He added that these steps are part of President Bola Tinubu’s broader policy initiatives aimed at sustainable growth in the energy sector.
“These bold initiatives will help Nigeria reclaim its position as a leader in the global oil and gas market,” Edun said. “The administration is committed to fostering sustainable growth, enhancing energy security, and driving economic prosperity for all Nigerians.”
