President Bola Tinubu has signed a new Executive Order targeting cost reduction, increased investment, and higher revenue returns. According to the President, the decision is a bold step to drive efficiency and revive investor confidence in Nigeria’s oil and gas sector.

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President Bola Tinubu has signed the “Upstream Petroleum Operations Cost Efficiency Incentives Order, 2025,” a strategic move aimed at revitalizing Nigeria’s oil and gas sector by reducing operational costs, attracting investment, and enhancing government revenues. www.multilinks.biz

🔧 Key Provisions of the Executive Order

• Performance-Based Tax Incentives: Oil and gas companies that achieve verifiable cost savings, meeting or exceeding industry benchmarks, will be eligible for tax credits. These credits are capped at 20% of the company’s annual tax liability, ensuring fiscal responsibility.
• Revenue Sharing: Qualifying operators can retain 50% of the incremental government revenue generated from their cost-saving measures, providing a direct financial incentive for efficiency.
• Terrain-Specific Benchmarks: The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) will annually publish cost benchmarks tailored to different operational terrains—onshore, shallow water, and deep offshore—to guide and assess company performance.
• Inter-Agency Coordination: The Special Adviser to the President on Energy is tasked with leading a coordinated effort among relevant government agencies to ensure effective implementation of the Order.

📈 Strategic Context and Objectives

This Executive Order builds upon previous reforms initiated in 2024, which improved fiscal terms, streamlined project timelines, and aligned local content policies with international standards. The overarching goal is to create a more competitive and efficient oil and gas industry that benefits all Nigerians. www.multilinks.biz

President Tinubu emphasized that this initiative is not merely about cost reduction but is a deliberate strategy to position Nigeria’s upstream sector as globally competitive and fiscally resilient. By rewarding efficiency and strengthening investor confidence, the government aims to deliver greater value to the Nigerian people. www.multilinks.biz

💬 Expert Insights

Industry analysts have noted that while the Executive Order is a positive step toward revitalizing Nigeria’s energy sector, its success will depend on coordinated implementation among government agencies and consistent policy execution. The introduction of performance-based incentives is expected to encourage operational efficiency and attract investment, but the actual impact will hinge on the government’s ability to enforce the new regulations effectively. www.multilinks.biz

This move is part of a broader effort by the Tinubu administration to address longstanding challenges in Nigeria’s oil and gas sector, including declining production levels and waning foreign investment. By creating a more favorable investment climate, the government hopes to stimulate economic growth and ensure that the benefits of the country’s natural resources are more widely shared among its citizens.

Tinubu’s Executive Order Aims to Revitalize Nigeria’s Oil Sector.

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