FG Unveils Tax Exemptions for Oil, Gas Sector

The Federal Government has unveiled a series of tax exemptions and fiscal incentives targeting key energy products and infrastructure.

Daily Report Nigeria reports that this move, described as a “groundbreaking concession,” aims to bolster both the upstream and downstream sectors.

The Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, announced these measures on Tuesday in a statement through the Director, Information and Public Relations, Federal Ministry of Finance, Mohammed Manga.

In it, the Federal Ministry of Finance revealed that the new incentives include the ‘Value Added Tax Modification Order 2024’ and the ‘Notice of Tax Incentives for Deep Offshore Oil and Gas Production.’

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The VAT Modification Order 2024 introduces 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.

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These measures are designed to reduce living costs, enhance energy security, and accelerate Nigeria’s transition to cleaner energy sources.

In addition, the Notice of Tax Incentives for Deep Offshore Oil & Gas Production offers new tax reliefs for deep offshore projects, positioning Nigeria’s deep offshore basin as a prime destination for global oil and gas investments.

These reforms are part of a broader series of investment-driven policy initiatives championed by President Bola Tinubu.

They were introduced to reflect the administration’s commitment to sustainable growth in the energy sector and enhancing Nigeria’s global competitiveness in oil and gas production.

The federal government further asserted that these bold initiatives will help Nigeria reclaim its position as a leader in the global oil and gas market, driving economic prosperity for all Nigerians.