- Afreximbank and Africa Petroleum Producer Organisation are in the final stages of setting up the African Energy Bank.
- APPO will decide which country the proposed African Energy Bank will be sited by the end of the first quarter of 2024.
Nigeria, one of the primary beneficiaries of the African Export-Import Bank (Afreximbank), accounts for 60 per cent of the US$30 billion funding of the energy sector in Africa. According to the News Agency of Nigeria (NAN), the President of Afreximbank, Prof. Benedict Oramah, said this while speaking on “Sustainable Strategies for Energy Leadership: Navigating Security, Transition and Finance in a Changing World” yesterday at the ongoing 7th Nigeria International Energy Summit (NIES 2024) in Abuja.
Oramah, represented by the Executive Vice President of Global Trade Bank (GTBA), Haytham Eimaayergi, said the continent lacked extensive traditional energy infrastructure. According to him, this presented an opportunity for leapfrogging more efficiently to renewable technology.
The bank notes that it has been able to contribute to the oil and gas sector because the bank was predominantly African in ownership and control. He said that with many international banks withdrawing funding from the oil and gas sector, investment in the industry had become limited, with a corresponding impact on exploration and production.
Afreximbank’s president states, “The support provided to the sector by Afreximbank is more than US$30 billion. Nigeria has been one of the largest beneficiaries, accounting for almost 60 per cent of the sector’s total funding. Our aspiration in the area of energy security and energy transition will remain an aspiration unless we have access to adequate funding resources that we control.”
“Afreximbank has intervened in a big way, quickly becoming the continent’s largest financier of oil and gas deals,” he added. The president stated that Afreximbank and Africa Petroleum Producers Organisation (APPO) are in the final stages of setting up the African Energy Bank.
Oramah explained that the Africa Energy Bank, being set up under a multilateral financial institution agreement, will focus on providing funding for the energy sector in the continent. Furthermore, he said they are structuring the bank to ensure African origin and control.
NAN reports that the Secretary-General of APPO, Dr Omar Ibrahim, had earlier announced that the decision on which country the proposed African Energy Bank will be sited is to be taken by the end of the first quarter 2024. Seven countries, including Nigeria, Algeria, Egypt, Ghana, South Africa, Benin Republic, and Cote d’Ivoire, are jostling for the proposed bank.
The bank’s president reiterated its commitment to help manage and operate the African Energy Bank to ensure that it has the best possible chances of success. According to him, the strategic goal of the Africa Energy Bank is to play a leadership role in shaping the energy landscape in Africa through strategic partnerships with proven African and international financial institutions and investors.
In addition, it will provide sustainable financing in the oil and gas sector. He, however, appealed for support from member states to achieve the level of capitalisation that would be adequate to support the energy sector.