Nigeria's Deep Offshore Tax Incentives Order 2026

On 6 August 2026, President Bola Ahmed Tinubu signed the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order, 2026, issued pursuant to the Petroleum Industry Act 2021 (“PIA”) and the Nigeria Tax Administration Act 2025. The Order consolidates the 2024 presidential fiscal incentive measures into a single framework for deep offshore developments under production sharing contracts, replacing the project-by-project negotiation that has characterised the sector, most recently in the terms granted for the Bonga South West Aparo development.

While the Order’s production tax credit provisions take effect from 28 February 2024, its administrative, approval and enforcement provisions apply from 6 August 2026. Amongst other incentives, the Order introduces a Supplementary Production Tax Credit and a Profit Oil Reset for qualifying greenfield deep offshore projects that achieve a Final Investment Decision on or before 31 December 2029.

Access to these incentives requires approval by the Nigeria Revenue Service (“NRS”) and compliance with Nigerian content requirements, and is subject to claw-back in defined circumstances. Additional implementation guidelines are expected from the NRS by 20 September 2026.

This client alert examines the Standard and Supplementary Production Tax Credits, the Profit Oil Reset and the profit gas sharing framework, the eligibility and Nigerian content requirements, the application, review and claw-back mechanisms, the Order’s interaction with the PIA and the 2025 tax legislation, and key considerations for operators, investors, and other industry stakeholders.

For further information, contact TEMPLARS Partner, Sesan Sulaiman, and Senior Associates, Omotayo Jimoh and Benedicta Onyeodi.

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