By Ovasa Ogaga,
The Federal Government has introduced a series of tax relief measures, including the removal of value-added tax (VAT) on diesel, Liquefied Petroleum Gas (LPG), and other key energy products, as part of its efforts to revitalize the oil and gas sector and boost investment.
In a statement released on Wednesday, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, announced that importation of critical energy products and infrastructure—such as diesel, feed gas, LPG, Compressed Natural Gas (CNG), electric vehicles, Liquefied Natural Gas (LNG) infrastructure, and clean cooking equipment—will no longer attract VAT. The initiative aims to enhance energy security, reduce the cost of living, and accelerate Nigeria’s transition to cleaner energy sources.
This announcement comes as global oil and gas giants ExxonMobil and Seplat prepare for new divestment plans, which have received presidential backing and are set to receive ministerial approval in the coming days.
The statement, signed by the Director of Information and Public Relations, Mohammed Manga, emphasized that these new policies will position Nigeria’s deep offshore oil and gas sector as a prime destination for international investment. It added that these fiscal measures are part of the government’s broader strategy to enhance energy security and boost Nigeria's economic development.
"In its commitment to revitalize the nation’s oil and gas industry, the Federal Government has introduced groundbreaking concessions, including the VAT Modification Order 2024 and the Notice of Tax Incentives for Deep Offshore Oil & Gas Production," the statement read.
The VAT Modification Order 2024 grants exemptions on a range of essential energy products, including diesel and clean cooking equipment, while new tax incentives for deep offshore projects aim to attract more global investment into Nigeria's oil and gas industry.
“These reforms are a testament to the government’s dedication to fostering sustainable growth, promoting energy security, and driving economic prosperity,” the ministry added.
The government’s latest policies are part of a wider series of reforms initiated by President Bola Tinubu under Policy Directives 40-42. These initiatives are designed to boost Nigeria’s competitiveness in the global energy market and solidify the nation’s status as a key player in oil and gas production.
