By Abdullahi Lukman
President Bola Tinubu has directed his Special Adviser on Energy, Mrs. Olu Verheijen, to coordinate the implementation of a new Executive Order aimed at reducing the cost of oil and gas projects, improving revenue, and accelerating investment in Nigeria’s energy sector.
According to a statement from the adviser’s office, signed by media aide Senan Murray, the directive is intended to ensure effective inter-agency coordination and alignment across key institutions to deliver measurable outcomes from the policy.
The Executive Order — titled Upstream Petroleum Operations Cost Efficiency Incentives Order (2025)— introduces performance-based tax incentives for upstream operators who achieve verifiable cost savings based on industry benchmarks.
These benchmarks, which vary by terrain (onshore, shallow water, deep offshore), will be published annually by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
Verheijen explained that the Order will allow investors to retain 50% of the incremental government gains resulting from cost reductions, while capping tax credits at 20% of a company’s annual tax liability.
This, she said, balances the goal of promoting efficiency with the need to protect government revenues.
“This is not about cost-cutting for its own sake,” she noted. “It’s about positioning Nigeria’s upstream sector to be globally competitive and fiscally resilient.
We are rewarding efficiency, restoring investor confidence, and ensuring greater value for Nigerians.”
The Order builds on earlier 2024 reforms which streamlined project timelines, improved fiscal terms, and updated local content policies to meet international standards.
Quoting President Tinubu, Verheijen emphasized: “Nigeria must attract investments based on real and enduring value. This Order signals our intent to build an efficient and competitive oil and gas sector that benefits all Nigerians. It’s about jobs, security, and making every barrel count.”
