An initiative to incentivise investors in the oil and gas segment of the nation’s economy aimed at attracting $10 billion investment, was yesterday unveiled by the Minister of Finance and Coordinator of the Economy, Wale Edun
The event which culminated in the endorsement of the Consolidated Guidelines for the implementation of Fiscal Incentives for the Oil & Gas Sector – a prime segment of the Presidential Directive aimed at enhancing the Nigerian oil & gas sector’s global competitiveness aimed at stimulating economic growth, took place at the headquarters of the Federal Ministry of Finance, Abuja.
The Presidential Directives were developed and coordinated by the Special Adviser to the President on Energy, Mrs. Olu Verheijen to ensure a competitive framework for the Nigerian oil and gas industry. These Consolidated guidelines for the fiscal incentives are based on extensive collaboration across Finance and Petroleum Ministries, as well as several key regulatory bodies including the Federal Inland Revenue Service (FIRS), the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
Mrs.Verheijen, said these new measures have been designed to deliver a competitive Internal Rate of Return (IRR) for Oil & Gas Projects and attract over $10 billion in new investments within the next 12-18 months, adding that they also underscore Nigeria’s commitment to reaching its long term oil production target of 4 million barrels per day whilst enhancing the reliability of gas supply to boost export earnings and fuel Nigeria’s industrialization.
Among the guidelines signed, she said, were the NUPRC Guideline on Hydrocarbon Liquids Content in a Non-Associated Gas (NAG) Field, essential for accurately categorising and quantifying the hydrocarbon liquid content in these fields. She said the guidelines also focused on the applicability of tax credits and allowances for Non-Associated Gas Greenfield Development and the Midstream Capital and Gas Utilization Allowance, providing taxpayers with clarity on the computation of these benefits.
In his remarks, Edun applauded President Bola Ahmed Tinubu for signing the directive in February 2024 to engender growth in the Nigerian oil and gas sector, which he said, had stagnated for more than 10 years. He also emphasised the potential of the guidelines, saying, “The idea is to create an atmosphere conducive to international competitiveness such that investment comes in, adding that in this case, “we know it’s foreign direct investment”.
The signing ceremony was attended by various stakeholders, including NNPC Limited, the Oil Producers Trade Section (OPTS) and the Independent Petroleum Producers Group (IPPG), further highlighting Nigeria’s unified approach toward reinvigorating its oil and gas sector.
