Section 85

(1) Notwithstanding the provisions of this Act or any other law, the
Associated
provisions of this section shall apply to all Non-Associated Gas greenfield
gas greenfield
developments in onshore and shallow water terrains reaching first commercial
develop-
ments in gas production from the commencement of this Act to 1 January, 2029 –
onshore and
shallow
water
terrains
Nigeria Tax Act, 2025 2025 No. 7 A 443
(a) where the hydrocarbon liquids do not exceed 30 barrels per million
standard cubic feet, there shall be granted a gas production tax credit at the
rate of US$1.00 per thousand cubic feet or 30% of the fiscal gas price,
whichever is lower;
(b) where the hydrocarbon liquids exceed 30 barrels per million standard
cubic feet but do not exceed 100 barrels per million standard cubic feet,
there shall be granted a gas production tax credit at the rate of US$0.50 per
thousand cubic feet or 30% of the fiscal gas price, whichever is lower;
(c) where the hydrocarbon liquids exceed 100 barrels per million standard
cubic feet, the incentives under subsections (a) and (b) shall no longer apply;
(d) the gas tax credit granted by this section shall apply on Non-Associated
Gas sales for 10 years only, beginning from the date of attaining first gas
production; and
(e) at the expiration of the 10 years referred to in subsection (1)(d), gas
production allowance shall be granted at the respective rates set out in
subsection (1)(a) and (b), provided that gas production tax credit and gas
production allowance shall not be granted in respect of gas production of
the same period.
(2) In the case of all other Non-Associated Gas Greenfield projects with
first commercial gas production after 1 January, 2029, gas production allow-
ance shall be granted at US$0.50 per thousand cubic feet or 30% of the fiscal
gas price, whichever is lower, provided that the hydrocarbon liquids do not
exceed 100 barrels per million standard cubic feet.
(3) The gas production tax credit that can be recouped in any year shall
not exceed the tax payable on the field(s) for that year on that income, subject
to the payment of any minimum tax where applicable.
(4) Unrecouped tax credit in one year may be carried forward for a
maximum of three years.
(5) The fiscal gas price for calculating gas production tax credit and gas
production allowance shall be the same price used for determining royalties.
(6) The provisions of this section shall apply to oil mining leases and
petroleum mining leases.
(7) Where first gas production cannot be achieved due to force majeure,
such as natural disasters or acts of terrorism, the timelines and obligations
stipulated in subsection (1) may be suspended, subject to approval by the
Commission, until such time as the force majeure ceases to exist.
(8) The Commission shall certify the applicable hydrocarbon liquid ratios
for the purposes of ascertaining appropriate gas production tax credit or gas
production tax allowance.
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(9) The incentives under this section shall not apply to any company that
has claimed Associated Gas Framework Agreement incentives for the same
Non-Associated Gas Greenfield project.
Provision