FG Unveils New Fiscal Incentives to Boost Oil, Gas Sector

•Introduces VAT modification order 2024 for exemptions on diesel, LPG, CNG, others

•Offers new tax reliefs for deep offshore projects

Ndubuisi Francis in Abuja

The federal government has unveiled a set of fiscal incentives and concessions designed to bolster operations in the nation’s upstream and downstream sectors of the economy.

Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, who unveiled the two major fiscal incentives, yesterday, said they were part of overall measures to revitalise Nigeria’s oil and gas sector:

The fiscal incentives included Value Added Tax (VAT) Modification Order 2024 and Notice of Tax Incentives for Deep Offshore Oil & Gas Production, in accordance with the Oil & Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order 2024.

A statement issued by the Director,  Information and Public Relations,  Federal Ministry of Finance,  Mohammed Manga, explained that the VAT Modification Order 2024 introduces exemptions on a range of key energy products and infrastructure, including Diesel, Feed Gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), Electric Vehicles, Liquefied Natural Gas (LNG) infrastructure, and Clean Cooking Equipment.

“These measures are designed to lower the cost of living, bolster energy security, and accelerate Nigeria’s transition to cleaner energy sources.

“In addition, the Notice of Tax Incentives for Deep Offshore Oil & Gas Production provides new tax reliefs for deep offshore projects.

“This initiative is aimed at positioning Nigeria’s deep offshore basin as a premier destination for global oil and gas investments.

“These reforms are part of a broader series of investment-driven policy initiatives championed by His Excellency, President Bola Ahmed Tinubu, in line with Policy Directives 40-42.

“They reflect the administration’s strong commitment to fostering sustainable growth in the energy sector and enhancing Nigeria’s global competitiveness in oil and gas production,” the statement said.

It stressed that, “with these bold initiatives, Nigeria is firmly on track to reclaim its position as a leader in the global oil and gas market,” adding that “these fiscal incentives demonstrate the administration’s unwavering commitment to fostering sustainable growth, enhancing energy security, and driving economic prosperity for all Nigerians.”