According to reports, the Federal Government of Nigeria is poised to obtain $10 billion in investments by finalising consolidated guidelines for the execution of Fiscal Incentives for the Oil & Gas Sector.
These comprehensive guidelines, stemming from Presidential Directives, aim to bolster global competitiveness and ignite economic expansion. The signing ceremony, presided over by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, took place at the Federal Ministry of Finance headquarters in Abuja on Tuesday.
A statement unveiled that the Presidential Directives, spearheaded and coordinated by the Special Adviser to the President on Energy, Mrs. Olu Verheijen, were crafted to establish a robust and competitive framework for Nigeria’s oil & gas industry.
“These Consolidated guidelines for the fiscal incentives are based on extensive collaboration across Finance and Petroleum Ministries and involved several key regulatory bodies including the Federal Inland Revenue Service, the Nigerian Upstream Petroleum Regulatory Commission and the Nigerian Midstream and Downstream Petroleum Regulatory Authority,” It read in part.
Verheijen emphasised that the newly devised measures aim to offer a competitive Internal Rate of Return for Oil & Gas Projects, to entice over $10 billion in fresh investments within the coming 12-18 months.
“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 for to boost export earnings and fuel Nigeria’s industrialisation,” she said.
She further highlighted that the NUPRC Guideline on Hydrocarbon Liquid Content in a Non-Associated Gas (NAG) Field, crucial for accurately assessing and quantifying the hydrocarbon liquid content in these fields was among the signed guidelines. Additionally, other guidelines focused on topics such as the applicability of tax credits, allowances for Non-Associated Gas Greenfield Development, and the Midstream Capital and Gas Utilization Allowance, providing taxpayers with clear guidelines on how to calculate these benefits.
Meanwhile, Wale Edun appreciated President Asiwaju Bola Ahmed Tinubu for signing the directive in February 2024, initiating a drive for growth in Nigeria’s oil and gas sector, which has remained stagnant for the past decade.