Tinubu’s offshore tax order to unlock $50bn, add 1mbpd - NUPRC

Nigeria's upstream petroleum sector is poised for a significant boost following President Bola Tinubu's recent executive order offering tax incentives for deep offshore oil and gas projects. The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) estimates that this measure could unlock approximately $50 billion in new investments.

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The Deep Offshore Oil and Gas Project Incentives (Tax Remission) Executive Order 2026 recently signed by President Bola Tinubu has the potential not only to unlock $50bn in investments but can also create an additional one million barrels per day of crude oil and condensate from deep offshore fields

Enorense Amadasu, Executive Commissioner for Development and Production at NUPRC, explained that the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Executive Order, signed recently, is designed to accelerate investment decisions on major projects. He anticipates that these incentives could add nearly one million barrels per day of crude oil and condensate to Nigeria's production within the next four to five years.

The executive order, also known as Executive Order 9, aims to enhance the financial viability of deep offshore projects by providing tax benefits and a more stable regulatory framework. This is crucial for an industry where projects typically demand billions of dollars and take many years from discovery to production. Amadasu highlighted that nine projects have already secured approved Field Development Plans, with Final Investment Decisions pending.

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We are on the right path, all thanks to Mr President. It will be a huge leap. As of today, we have mined over 4.6 billion barrels from deep offshore assets. In cargo terms, that is about 5,000 tankers.

Nigeria currently produces around 1.7 million barrels per day, with deep offshore fields contributing about 24% of its oil output. The new framework is expected to attract substantial investment, supporting future deep offshore projects. Amadasu specifically mentioned the Bonga South project, expecting $10 billion in investment and contributing to the anticipated production increase starting in 2027.

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So, where will these volumes be coming from? Nine of these projects have approved FDPs, so the next step expected is the FID in the near to midterm. The $10bn Bonga South will come in 2027, and within the next four to five years, we are expecting almost an additional one million barrels per day.