Tinubu Signs Executive Order on Oil, Gas Projects, Initiates Amendment of Legislation to Introduce Fiscal Incentives

•Moves to position Nigeria as Africa’s preferred investment destination sector 

•Ekpo assures Chinese investors of conducive investment climate

Deji Elumoye and Peter Uzoho

President Bola Tinubu has given policy directives to improve the investment climate and position Nigeria as the preferred investment destination for the oil & gas sector in Africa.

Specifically, following extensive engagements, analyses and benchmarking with other jurisdictions, the President has initiated the amendment of primary legislation to introduce fiscal incentives for oil & gas projects, reduce contracting costs and timelines, and promote cost efficiency in local content requirements.

According to a statement issued yesterday, by presidential spokesperson, Ajuri Ngelale, the latest move was in keeping with the President’s dedicated efforts to remove obstacles to investments in Nigeria, harness the nation’s resources and diversify the economy for the benefit of all Nigerians.

It noted that recognising the urgency to accelerate investments, the President directed the

introduction of fiscal incentives for non-associated gas, midstream and deepwater developments; ⁠Streamlining of contracting process to compress the contracting cycle to six months and ⁠the application of the local content requirements without hindering investments or the cost competitiveness.

“The details of these Policy Directives will be gazetted and communicated by the Federal Ministry of Information and National Orientation.

“These incentives were developed in collaboration with the Federal Ministry of Justice, Federal Ministry of Finance, Federal Ministry of Petroleum, Federal Ministry of Budget and Economic Planning, Federal Inland Revenue Service, the Nigerian National Petroleum Company Limited, the Nigerian Upstream Petroleum Regulatory Commission, the Nigerian Midstream and Downstream Petroleum Regulatory Commission, and the Nigerian Content Development and Monitoring Board,” the statement added.

It revealed that the Special Adviser to the President on Energy has been directed to continue coordinating the aforementioned stakeholders to ensure the implementation of the directives within a stipulated timeframe.

Meanwhile, the Minister of State for Petroleum Resources (Gas), Hon. Ekperikpe Ekpo, has assured Chinese companies of the security and safety of their investments in the Nigerian gas sector. 

The minister gave the assurance yesterday, while hosting top officials of Shanghai Huayi Energy Chemical Company Group of China (HUAYI) and China Road and Bridge Corporation, who are strategic investors in the Brass Methanol and Gas Hub Project in Bayelsa State.

Ekpo, who spoke against the backdrop of political risks and security often nursed by prospective foreign investors to Nigeria, described the Brass project as one critical project of the President Bola Tinubu-led administration.

According to the minister, Nigeria was open for investments and investors, particularly in the gas sector, saying investors needed not to entertain any fear.

Ekpo stated, “The federal government is committed to developing Nigeria’s gas reserves through projects such as the Brass Methanol project which presents an opportunity for the diversification of Nigeria’s economy.

“It is for this and other reasons that the project has been accorded the significant concessions (or support) that it enjoys from government. Let me therefore assure you of the strong commitment of our government to the security and safety of yours and other investments as we have continually done for similar Chinese investments in Nigeria through the years.”

Ekpo, tasked investors and contractors working on the project to double their efforts, saying “I want to see this project running for the good of Nigeria and its investors.”

In his remarks, the leader of the Chinese delegation, Mr. Zheng Bi Jun, said the visit to the country was to carry out feasibility studies for investments in methanol projects.

On his part, the Managing Director of Brass Fertilizer and Petrochemical Ltd, Mr. Ben Okoye, expressed optimism of partnering with genuine investors on the project.