Tinubu Signs Executive Order to Cut Oil Project Costs and Boost Investment

President Bola Tinubu has signed an Executive Order aimed at reducing costs in Nigeria’s oil and gas sector, boosting government revenue, and attracting investment.

The directive introduces fiscal reforms focused on cost efficiency, operational accountability, and national value retention.

The order, titled Putting Every Barrel to Work: Nigeria’s New Presidential Directive on Cost Efficiency, sets a framework for lowering production expenses while offering competitive terms to investors. A key provision caps tax credits at 20% of a company’s annual tax liability, ensuring fiscal discipline while incentivizing efficiency.

Effective from April 30, 2025, the Upstream Petroleum Operations Cost Efficiency Incentives Order establishes performance-based tax incentives for operators who achieve verifiable cost savings aligned with industry benchmarks. The Nigerian Upstream Petroleum Regulatory Commission will publish annual benchmarks for onshore, shallow water, and deep offshore operations.

The government aims to streamline contracting timelines and local content compliance requirements to improve competitiveness. The Special Adviser on Energy, Olu Verheijen, emphasized that the reform is designed to strengthen investor confidence and maximize Nigeria’s economic gains from petroleum operations.

President Tinubu stated that the order signals Nigeria’s commitment to building an efficient and competitive oil and gas sector that benefits all citizens. Implementation guidelines will be issued soon, ensuring alignment across key government institutions. You can read more details