(Ecofin Agency) – Nigeria is still struggling to mobilize investments to support the development of its oil and gas industry, regularly hampered by structural challenges which affect the monetization of the country’s energy resources, particularly at sea.
In Nigeria, a legal framework was introduced on Thursday October 3 to stimulate investments in the deepwater gas sector, considered underexploited despite the significant hydrocarbon potential highlighted in the offshore.
The text targets a particular financial objective. “We intend to unlock between USD 5 billion and USD 10 billion in new investments in Nigeria in the short to medium term” said Olu Verheijen, President Bola Tinubu’s special advisor on Energy.
The legal arsenal is awaiting parliamentary approval. The new law provides concrete tax incentives, among other things in the form of tax credits, in favor of oil investors. It should also allow the establishment of a gas production allocation for projects targeting the exploitation of oil and gas deposits on land and in shallow waters, in particular those whose operational phase is planned for by 2029.
For more than a year, the policy of the Nigerian State, which attaches great importance to the development of the oil industry, an economic sector covering approximately 5.5% of GDP and approximately 92% of exports, has attracted more than 30 USD of direct foreign funds.
Declining in recent years, investment in the oil and gas sector remains a challenge for the government. According to analysts, strengthening the overall attractiveness of the Nigerian hydrocarbon industry is only one of the solutions to be implemented to raise it consistently.
Abdel-Latif Boureima
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