Nigeria’s indigenous oil producers have raised the alarm over what they
described as an excessive fiscal burden on the country’s petroleum industry.
The group under the aegis of the Independent Petroleum Producers Group
(IPPG) revealed that operators contend with more than 270 different taxes, fees
and statutory levies.
Chairman of IPPG, Adegbite Falade, stated this in his keynote address at the
opening of the 2026 NOG Energy Week in Abuja.
He said a situation where oil firms pay as much as 270 different types of taxes
and levies discourages investment and threatens the viability of many projects.
Falade said while recent government reforms have improved investor
confidence, the multiplicity of charges imposed by different government
agencies risks undermining those gains.
“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,” he said.
According to him, the cumulative burden of these charges has begun to
outweigh the incentives introduced under the Petroleum Industry Act (PIA),
particularly for smaller indigenous operators managing mature oil assets.
He warned that the situation could force some operators to abandon projects,
urging the Federal Government to harmonise the various charges into a
transparent and globally competitive fiscal framework.
“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,” he said.
Beyond fiscal reforms, the IPPG chairman identified an emerging manpower
crisis as another major threat to the industry, noting that the retirement of
experienced professionals and recent international oil company divestments
have created significant skills gaps that require urgent investment in workforce
development.
Falade also called for a comprehensive review of the PIA five years after its
enactment, to address implementation challenges and incorporate presidential
directives that have improved investment conditions.
He said that Nigeria must shift its focus from simply increasing crude oil
production to creating greater value through refining, gas processing, power
generation, fertiliser production and petrochemicals.
According to him, the country’s vast hydrocarbon resources should serve as a
catalyst for industrialisation rather than continued exports of raw crude and gas.
While commending the administration’s reforms that have helped secure more
than $8 billion in upstream final investment decisions since 2023 and boosted
oil production to about 1.6 million barrels per day, Falade maintained that
sustainable growth would depend on creating a more competitive operating
environment for investors.