President Bola Ahmed Tinubu has approved another landmark policy shift in the nation’s oil and gas industry with the new reform expected to unlock $50 billion in deep offshore investments.
The reform under Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, which replaces project-by-project negotiations with a transparent, rules-based investment framework was designed to restart Nigeria’s large, capital-intensive offshore developments that have remained stalled for decades.
The Presidency, which announced the approval yesterday, stated that the new transparent, rules-based investment framework would support next generation of deep offshore developments, beginning with the $10 billion Bonga South West project.
President Tinubu yesterday said the reform reflected his government’s commitment to attracting foreign and domestic investments by creating enabling environment for private sector development.
He said: ‘The countries that attract long-term investment are not necessarily those with the greatest natural resources. They are the ones that provide the greatest certainty. This reform reflects our determination to build an investment environment defined by clear rules, strong institutions and enduring partnerships.
‘We are creating the conditions for capital to flow, for Nigerian businesses to grow, for our people to prosper and for our natural resources to deliver lasting national value’.
He commended all stakeholders, including Federal Ministry of Justice, Federal Ministry of Finance, Federal Ministry of Petroleum Resources, Nigeria Revenue Service, NNPC Limited, Nigerian Upstream Petroleum Regulatory Commission, Nigerian Content Development and Monitoring Board, investing partners and others whose collaboration, technical expertise and commitment helped shape the framework.
The new framework followed President Tinubu’s engagement with Chief Executive Officer of Shell Plc, Mr. Wael Sawan, during which the President directed government to develop the next wave of measures required to unlock Nigeria’s deep offshore investment pipeline.
Rather than pursuing project-specific solutions, government transformed that directive into a comprehensive investment framework applicable across multiple categories of qualifying developments.
The Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, provides transparent eligibility criteria, clear implementation processes and a durable investment architecture that provides greater certainty for investors while safeguarding long-term national value.
The approval also enables NNPC Limited, as government’s nominated counterparty under the Production Sharing Contracts, to proceed with the necessary amendments to eligible Production Sharing Contracts required to implement the framework.
A defining feature of the policy shift is its emphasis on Nigerian industrial capability with projects under the framework expected to maximise commercial and technical execution within Nigeria, thus strengthening domestic engineering, fabrication, marine logistics, technical services and project management.
‘The objective is not only to increase investment and production, but also to create skilled jobs, deepen local supply chains and position Nigeria as Africa’s regional hub for deep offshore project execution,’ the Presidency stated.
Outlining the underlying philosophy for his reforms, President Tinubu, who spoke at the Second West African refined Fuel Market Conference in Abuja, said his government has undertaken difficult but necessary reforms to create a more competitive energy market, strengthen the investment environment and reposition energy as an engine for economic growth.
Represented by his Special Adviser on Oil and Gas, Olu Arowolo-Verheijen, President Tinubu underlined the importance of transparency, collaboration, commercial pragmatism and constructive engagement with industry in order to build a competitive energy sector.
‘Strong regulation is not measured by the number of obstacles placed in the path of investment. It is measured by the clarity of the rules, the consistency of their application, the quality and timeliness of regulatory decisions, and the confidence the regulator inspires in citizens and investors alike.
‘Investor confidence is not built by lowering standards. It is built by establishing clear standards, enforcing them fairly and ensuring that credible investors can make long-term decisions with certainty. The task now is to institutionalise this approach and ensure that the market experiences it consistently,’ Tinubu said.
He described the conference as timely noting that West Africa’s energy challenge is entering a new phase.
The President said his ambition was to see Nigeria serving as a dependable anchor for a deeper, more competitive and increasingly integrated West African energy market.
‘In order to achieve this, every stakeholder represented here has a role. Financial institutions must develop funding structures that recognise the long-term value of energy infrastructure and support credible projects across the distribution chain.
‘Industry must invest, execute and provide the reliable transaction data required to build confidence in regional price benchmarks. Governments must create predictable policies and remove unnecessary barriers to cross-border trade. And regulators must protect the public interest while enabling investment, innovation and competition,’ Tinubu said.
According to him, the question now is no longer simply whether the region has the resources or refining capacity to meet its energy needs, the more important question is whether West Africa can build the infrastructure, financing systems, regulatory institutions and transparent markets required to move energy efficiently from where it is produced to where it is needed.
‘That is why the theme of this conference is so important. West Africa is not short of demand. We are not short of resources. What has constrained us is the fragmentation of our markets and the absence of sufficient infrastructure to connect supply, demand and capital across the region.
‘Refining capacity alone does not create energy security. A refined product only delivers economic value when it can be financed, stored, transported and distributed reliably. Without infrastructure, supply remains stranded. Without transparent pricing, investors price uncertainty rather than opportunity. Without regulatory coordination, borders become bottlenecks rather than gateways to trade.
‘Price transparency is therefore not simply a reporting exercise. It is essential market infrastructure. A credible regional benchmark cannot be declared into existence. It must be built on actual transactions, reliable data, sufficient market liquidity and confidence in the institutions that support it.
‘Our ambition should be that a product refined in West Africa should not have to leave West Africa before the market can credibly determine its value. Today, Nigeria refines the majority of the petrol we consume domestically. Imports have fallen significantly, while refined products produced in Nigeria are increasingly reaching markets across Africa and beyond.
‘But increased refining capacity also creates a new responsibility. We must build the pipelines, ports, storage facilities, coastal vessels, trucking networks and trading platforms required to move products safely and efficiently. We must expand access to trade and infrastructure finance. We must establish common product standards and strengthen cooperation between regulators, customs authorities and market participants,’ Tinubu said.