Section 79 Nigeria Tax Act 2025

Section 79 of the Nigeria Tax Act 2025 is about Registration and use of separate company for each stream of petroleum operations. It provides as follows:

(1) Subject to sections 142 (2) and 197(2) of the Petroleum Industry Act, a person intending to be involved in more than one stream, that is, upstream, midstream or downstream petroleum operations, shall register and use a separate company for each stream of petroleum operations under the Petroleum Industry Act:

Provided that, for companies with petroleum mining leases selected under section 93 (6) (b) and (7) (b) of the Petroleum Industry Act, no stamp duties, value added tax or income tax on chargeable gains shall be levied by the Government on such segregation.

(2) For strategic projects in the upstream petroleum operations that seek to produce oil and natural gas to be processed or refined to finished petroleum
products, and supplied in wholesale solely to the domestic market, such projects
shall have the option to be established as an integrated strategic project (ISP),
whereby the capital investment in the associated midstream petroleum operations as defined under the Petroleum Industry Act, can be consolidated with the upstream petroleum operations for purposes of tax.

(3) Where an ISP option is elected, the following provisions shall apply –
(a) arm’s length transfer prices shall be established to fiscalise the hydrocarbons transferred from the upstream petroleum operations to the midstream petroleum operations; and

(b) capital investment in the midstream petroleum operations consolidated with upstream petroleum operations shall not be represented for capital allowance when fiscalising the income from midstream petroleum operations.

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