The Federal Government has reaffirmed its commitment to sustaining policies and incentives that will keep Nigeria attractive to global energy investors. Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, emphasized the government’s resolve to drive sustainable production growth and target idle oil assets during an inspection of the NNPC/Chevron Nigeria Limited Joint Venture EGTL facility in Escravos, Delta State.
Lokpobiri stated that the government aims to provide a globally competitive environment that allows companies to expand their investments in the country. He encouraged operators to develop all available blocks and consider farming out idle assets to partners with access to capital. The minister also noted that the government is reviewing the activation of the “drill or drop” provision in the Petroleum Industry Act to ensure timely development of oil and gas resources.
The Federal Government recently introduced fiscal incentives to revitalize the oil and gas sector, including the Value Added Tax (VAT) Modification Order 2024 and Notice of Tax Incentives for Deep Offshore Oil & Gas Production. These incentives aim to lower the cost of living, bolster energy security, and accelerate Nigeria’s transition to cleaner energy sources. The tax reliefs for deep offshore projects are designed to attract global investments to Nigeria’s deep offshore basin.
The government targets $10 billion in new investments in the oil and gas sector within the next 12 to 18 months. Olu Verheijen, Special Adviser to President Bola Tinubu on Energy, stated that the new fiscal policies would deliver a competitive internal rate of return (IRR) for oil and gas projects and attract significant investments. Nigeria’s oil production target is set at 2.06 million barrels per day (bpd) in the short term and 4 million bpd by 2030.
The visit to the NNPC/Chevron Nigeria Limited Joint Venture EGTL facility underscores the strong partnership between the Federal Government and Chevron. Chevron’s General Manager, Segun Kuteyi, expressed optimism about the company’s future in Nigeria and lauded the Minister’s commitment to collaboration. Chevron’s Chairman/MD, Jim Schwartz, highlighted the enabling role of the Petroleum Industry Act and government support in attracting and sustaining investment.
The government is working to enhance security in oil-producing areas, implement a data-driven security framework, and encourage deepwater oil exploration. These efforts have already led to an increase of 500,000 bpd in oil production since the administration took office. Additionally, the government aims to expand Nigeria’s domestic refining capacity, improve electricity supply, and strengthen the power sector’s financial stability.
The Federal Government’s commitment to providing a competitive environment and attractive incentives for energy investments is expected to drive sustainable production growth and unlock Nigeria’s oil and gas potential. With new investments and strategic reforms, Nigeria’s oil sector is on track for sustained growth, ensuring the country remains competitive in the global energy market.
