The Federal Government has halted the value-added tax (VAT) on diesel and cooking gas as part of its strategy to attract foreign investments into Nigeria’s oil and gas sector. The announcement was made by Finance Minister and Coordinating Minister of the Economy, Wale Edun, in a statement issued on Wednesday.

As outlined in the statement from the Finance Ministry, which was signed by Director of Information and Public Relations Mohammed Manga, these new incentives are designed to rejuvenate Nigeria’s oil and gas industry. Notably, the importation of crucial energy products and infrastructure—including diesel, feed gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), electric vehicles, Liquefied Natural Gas (LNG) infrastructure, and clean cooking equipment—will now be exempt from VAT.

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Manga emphasized that this initiative aims to position Nigeria’s deep offshore basin as a leading destination for global oil and gas investments, improve energy security, and facilitate the nation’s shift toward cleaner energy solutions. This announcement coincides with the recent divestment plans from ExxonMobil and Seplat, which President Bola Tinubu indicated would soon receive ministerial approval.

In the statement, it was noted, “The Federal Government has introduced groundbreaking concessions aimed at revitalising the industry.” The Finance Minister further elaborated on the VAT Modification Order 2024, highlighting the exemption of various key energy products and infrastructure from tax obligations, reinforcing the government’s commitment to enhancing the upstream and downstream sectors of the economy.