Boost investment, revenues
President Bola Ahmed Tinubu has signed a landmark Executive Order aimed at transforming Nigeria’s oil and gas sector by driving down project costs, attracting fresh investment, and improving government revenues from upstream petroleum operations.
The Upstream Petroleum Operations Cost Efficiency Incentives Order (2025), announced Thursday in a statement issued by Senan Murray, Media Contact in the Office of the Special Adviser to the President on Energy, introduces performance-based tax incentives that reward oil and gas companies for achieving verifiable cost savings in line with annual industry benchmarks.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) is tasked with setting and publishing these benchmarks yearly across operational terrains—onshore, shallow water, and deep offshore.
The order also promises detailed implementation guidelines to follow.
“Nigeria must attract investment inflows, not out of charity, but because investors are convinced of real and enduring value.
“This Order is a signal to the world: we are building an oil and gas sector that is efficient, competitive, and works for all Nigerians. It is about securing our future, creating jobs, and making every barrel count,” President Tinubu stated.
Key provisions of the Executive Order include a 50% return to investors from any incremental government revenue generated through cost savings, and a cap on tax credits at 20% of a company’s annual tax liability.
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The balanced approach is designed to encourage operational efficiency while safeguarding national revenues.
“This is not a pursuit of cost reduction for its own sake. It is a deliberate strategy to position Nigeria’s upstream sector as globally competitive and fiscally resilient,” said Mrs. Olu Verheijen, Special Adviser to the President on Energy.
She added, “With this reform, we are rewarding efficiency, strengthening investor confidence, and ultimately delivering greater value to the Nigerian people.”
President Tinubu has directed the Special Adviser on Energy to lead an inter-agency effort to coordinate the policy’s rollout, aligning key institutions and ensuring the directive’s goals are realized across all levels of implementation.
The 2025 Executive Order builds on President Tinubu’s earlier oil and gas reform measures issued in 2024, which introduced improved fiscal terms, reduced project execution timelines, and harmonized local content policies with global standards.
The new directive marks a further push in Tinubu’s administration’s strategy to revitalize Nigeria’s petroleum sector under the broader goals of the Renewed Hope Agenda, combining investor-focused policies with a commitment to long-term national value.
