President Bola Tinubu has signed a new executive order designed to attract investment into Nigeria’s oil sector by reducing project costs while safeguarding government revenue. The move is part of broader efforts to boost crude production in Africa’s largest oil producer.
The directive, announced late Thursday, introduces a 20% cap on tax credits relative to a company’s annual tax liability and includes performance-based incentives for upstream operators. Implementation guidelines are expected to follow.
“This marks a turning point — not just for cost efficiency, but for investor trust and sector-wide discipline,” said Olu Verheijen, Special Adviser to the President on Energy. “We’re using policy to drive performance, unlock capital, and turn natural resources into real economic dividends for Nigerians.”
Presidential spokesperson Bayo Onanuga said the order builds on earlier fiscal reforms aimed at improving investment terms and accelerating project timelines.
The new policy follows Nigeria’s 2023 initiative to attract up to $10 billion in deep-water exploration through tax breaks and incentives aimed at developing natural gas and enhancing energy security. Oil giants including Shell and ExxonMobil have since expanded their investments in Nigerian assets.
Since taking office in May 2023, Tinubu has enacted sweeping reforms he claims have attracted over $30 billion in foreign capital. While international investors have welcomed the changes, the reforms have also strained consumer purchasing power in a country where nearly half the population lives in extreme poverty.
