Oil firms decry multiple taxes, seek PIA review as Nigeria joins IEA

Indigenous oil producers have warned that Nigeria’s upstream petroleum sector is being weighed down by more than 270 different taxes, fees and statutory levies, saying the multiplicity of charges is beginning to erode the investment gains recorded under the Petroleum Industry Act despite renewed investor confidence in the industry.

The warning came on Tuesday at the opening ceremony of the 2026 NOG Energy Week in Abuja, where industry leaders also celebrated Nigeria’s admission into the International Energy Agency as its newest Association Country, describing the development as a major endorsement of the country’s ongoing energy reforms and growing influence in global energy diplomacy.

The 25th edition of NOG Energy Week, marking the conference’s silver jubilee, is themed, “Advancing Energy Ambitions for Competitive & Resilient Economies.”

Chairman of the Independent Petroleum Producers Group, Adegbite Falade, while delivering the industry’s keynote address, said the country’s fiscal regime had become one of the biggest threats to sustaining investment inflows into the oil and gas sector.

According to him, although President Bola Tinubu’s administration has introduced sweeping reforms that have restored investor confidence and improved crude oil production, the burden of over 270 taxes and levies imposed by different government agencies risks offsetting the benefits of the Petroleum Industry Act.

Falade said, “A Shift in Government Posture: From Collector to Catalyst As we chart a path forward, we must confront a challenge that continues to erode industry-wide competitiveness – the sheer weight and multiplicity of fees, levies, and statutory charges imposed across the value chain.

“Today, the Nigerian oil and gas industry remains the most taxed and levied in the country, and perhaps globally, with over 270 separate fees, taxes and levies. These fees from multiple agencies and the cumulative burden threaten to outpace fiscal incentives introduced under the Petroleum Industry Act to attract and retain investment.

“For smaller producers and operators of mature assets with thinner margins, this burden is a direct threat to project viability, investment decisions, and in some cases, asset abandonment. We therefore urge government to undertake a comprehensive harmonisation of all fees and levies across all agencies to eliminate duplication, ensure transparency in how these charges are computed and applied, and align the overall fiscal burden with the incentive-driven spirit of the PIA.

“A predictable, streamlined, and globally competitive cost environment is a prerequisite for the very growth, job creation, and production gains this administration seeks to achieve.”

Despite the concerns, the IPPG chairman commended the Federal Government for implementing reforms that have revived the industry’s investment outlook.

He said Nigeria had recorded a remarkable recovery in crude oil production from levels below one million barrels per day a few years ago to an average of about 1.6 million barrels daily between January and May this year, noting that May production exceeded Nigeria’s OPEC quota for the first time in almost one year.

Falade added that the administration had attracted more than 5bn Bonga North project, the 18.2bn were approved in 2025 alone, unlocking about 1.4 billion barrels of crude oil and 5.4 trillion cubic feet of gas.

“Mr President, on behalf of indigenous producers, thank you for your unyielding commitment towards building a sustainable oil and gas industry. The collaborative efforts of government, regulators, security agencies, host communities and operators are yielding the desired results,” he stated.

Falade, however, cautioned that Nigeria had repeatedly failed to take full advantage of geopolitical disruptions because of inadequate production capacity and delayed investments.

He recalled that the Russia-Ukraine war created huge opportunities for alternative gas suppliers to Europe while the recent tensions involving the United States, Iran and the wider Middle East pushed global crude prices significantly above Nigeria’s budget benchmark.

According to him, Nigeria could not maximise the resulting revenue opportunities because of production constraints. “The lesson from both crises is the same – the next geopolitical shock is not a question of if, but when. We must borrow a leaf from the Dangote Refinery by prioritising upfront investment in potent capacity.

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“We must see infrastructure not just as an economic asset but as a strategic national shield. It is therefore imperative to build the partnerships, capital and readiness today that enable us to seize tomorrow’s opportunity rather than watch it pass us by once again,” he added.

The IPPG chairman also called for a comprehensive review of the Petroleum Industry Act five years after its implementation, arguing that the law should be strengthened by incorporating the various presidential directives and executive orders introduced since its enactment.

He also warned that the industry was facing a growing manpower crisis following the retirement of experienced professionals and the wave of international oil company divestments, stressing that operators must significantly increase investments in training the next generation of industry professionals.

Meanwhile, the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, described Nigeria’s recent admission into the International Energy Agency as one of the country’s biggest diplomatic achievements in the global energy sector.

According to the minister, the country’s admission as an Association Country on July 2 makes Nigeria the first member of the Organisation of the Petroleum Exporting Countries to establish such a partnership with the IEA and the sixth African nation to attain the status.

Ekpo said the development reflects growing international confidence in Nigeria’s reform agenda and strengthens the country’s position in shaping global conversations on energy transition.

He said, “Complementing this, on July 2, 2026, the International Energy Agency officially admitted Nigeria as its newest Association Country. As the first OPEC member to partner with the IEA and its sixth African Association member, Nigeria is uniquely anchoring a balanced global dialogue, ensuring equitable energy transitions while defending the right of developing nations to responsibly harness their gas assets.

“Our progressive steps have recently resonated on the global stage, elevating Nigeria to the pinnacle of global energy diplomacy. Nigeria has proudly assumed the Presidency of the 2026 Gas Exporting Countries Forum Ministerial Meeting alongside the election of Nigeria’s Dr Philip Mshelbila as the GECF Secretary-General. This dual leadership reflects international confidence in our technical expertise and policy vision.”

The minister said the Federal Government’s reforms, backed by the Petroleum Industry Act and subsequent executive orders signed by President Tinubu, had created a more stable, transparent and competitive investment climate for gas development.

He noted that the reforms had shortened contracting timelines, introduced targeted fiscal incentives for non-associated gas projects, removed bureaucratic bottlenecks and restored the commercial viability of deep-water gas developments.

“Our message to the global investment community is unified and resolute: Nigeria is open for business, and we have established a stable, competitive and highly predictable investment environment,” Ekpo stated.

He added that the government’s long-term strategy was to transform Nigeria from a country that merely possesses vast gas reserves into one powered by natural gas, saying the Decade of Gas initiative was driving investments in gas processing, pipelines, fertiliser production, petrochemicals, power generation and compressed natural gas transportation.

According to him, major infrastructure projects, including the Ajaokuta-Kaduna-Kano and OB3 gas pipelines, alongside the expansion of Nigeria LNG through Train 7, would strengthen domestic gas utilisation while expanding Nigeria’s footprint in the global liquefied natural gas market.

“The defining question before us is not whether the world will need more energy – it will. The question is who will provide that energy responsibly, reliably and competitively.

“Nigeria is prepared to answer that call. We possess the resources, we are implementing the reforms, we are building the infrastructure, we are strengthening our institutions and, above all, we are creating an environment in which investment can flourish and shared prosperity can be realised. Nigeria is ready. Nigeria is open for business. Nigeria is investing in the future,” the minister declared.