By Lizzy Chirkpi
President Bola Ahmed Tinubu has approved a new investment framework designed to unlock up to US$50 billion in deep offshore investments and revive major oil and gas projects that have remained stalled for years.
The reform, introduced through the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, replaces project-by-project negotiations with transparent eligibility criteria and a rules-based framework intended to provide investors with greater certainty and predictability.
According to the Presidency, the framework will initially support the approximately US$10 billion Bonga South West project, while establishing an investment architecture that can be applied to other qualifying deep offshore developments.
The government expects the initiative to attract fresh capital, increase oil production, create jobs, strengthen Nigerian businesses and boost government revenues over the long term.
President Tinubu said the reform was designed to make Nigeria more competitive in the global market for long-term capital.
“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,” Tinubu said.
He added that the government was creating an investment environment based on “clear rules, strong institutions and enduring partnerships.”
Deep offshore developments require huge upfront capital, advanced technology and lengthy development timelines, making fiscal and regulatory certainty critical to investors.
The new framework is therefore expected to improve the commercial viability of projects that have struggled to progress under previous arrangements.
The Presidency said the reform would help restart “Nigeria’s large, capital-intensive offshore developments that have remained stalled for decades.”
Beyond Bonga South West, the framework could support several other qualifying projects and potentially attract up to US$50 billion in fresh capital into Nigeria’s upstream sector.
The revival of major offshore developments could increase crude oil production and stimulate activity across the petroleum value chain.
Higher production could also generate additional government revenue through applicable royalties, profit-sharing arrangements, taxes and other receipts over the lifespan of the projects.
Although the framework provides tax remission to improve the economics of qualifying investments, the government is relying on increased investment and production to deliver broader economic benefits.
The policy could also help reverse years of underinvestment in the upstream sector by making Nigeria more competitive with other oil-producing countries seeking to attract global capital.
Focus on Nigerian Content
The reform places significant emphasis on Nigerian participation in the execution of offshore projects.
The President’s Special Adviser on Energy, Olu Verheijen, said qualifying projects would maximise execution in Nigeria wherever commercially and technically feasible.
“Projects qualifying under the framework will maximise execution within Nigeria wherever commercially and technically feasible, 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,” Verheijen said.
The policy is expected to create opportunities for Nigerian engineering companies, fabricators, marine logistics firms, technical service providers and other businesses across the oil and gas value chain.
Increased project activity could also stimulate demand for skilled Nigerian workers while encouraging investment in specialised infrastructure and technical capabilities.
Shift from Negotiations to Clear Rules
A major feature of the reform is the shift away from individual negotiations towards a predictable framework applicable to qualifying projects.
The Presidency said the approach would give investors greater visibility when making long-term investment decisions and strengthen Nigeria’s competitiveness in attracting globally mobile capital.
The framework was developed following an extensive inter-agency process involving fiscal, legal, commercial and regulatory institutions, as well as industry operators.
President Tinubu commended the Federal Ministry of Justice, Federal Ministry of Finance, Federal Ministry of Petroleum Resources, Nigeria Revenue Service, NNPC Limited, Nigerian Upstream Petroleum Regulatory Commission and Nigerian Content Development and Monitoring Board, alongside investing partners and other industry stakeholders, for their contributions to the process.
The approval also enables NNPC Limited, as the government’s nominated counterparty under the Production Sharing Contracts, to proceed with the necessary amendments to eligible PSCs required to implement the framework.
The move is expected to provide a clearer pathway for qualifying projects to progress from negotiations and planning to final investment decisions and development.
This is particularly significant for deep offshore projects, which require substantial upfront capital and long-term investment commitments.
What Nigeria Stands to Gain
If successfully implemented, the reform could attract up to US$50 billion in investment, increase crude oil production, expand economic activity, create skilled employment, strengthen local supply chains and generate additional government revenue over the life of qualifying projects.
It could also help reposition Nigeria as a major destination for deep offshore investment in Africa and strengthen the country’s position in the global competition for upstream capital.
However, the ultimate test of the policy will be whether it translates into actual investment commitments, final investment decisions, construction activity and increased production.
Tinubu said the broader objective was to ensure that Nigeria’s natural resources generate lasting economic value.
“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 said.”