The Federal Government of Nigeria has announced the removal of value-added tax (VAT) on key energy products, including diesel, Liquefied Petroleum Gas (LPG), and cooking gas, as part of efforts to stimulate investments in the oil and gas sector. This new policy was unveiled by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, in a statement issued on Wednesday.

The statement highlighted that the VAT exemption also applies to the importation of critical infrastructure like Compressed Natural Gas (CNG), electric vehicles, and clean cooking equipment. These measures are aimed at bolstering energy security, positioning Nigeria’s deep offshore oil and gas sector as a prime investment destination, and supporting the country’s transition to cleaner energy sources.

The tax relief arrives as ExxonMobil and Seplat prepare for new divestment plans, which are expected to receive ministerial approval soon. The government believes these initiatives will revitalize both the upstream and downstream sectors, fostering economic growth and attracting global investments.