Africa Energy Bank to start operating in ’24

The proposed Africa Energy Bank, poised to focus on oil and gas investments continent-wide, plans to commence operations later this year with an initial $5 billion capital, according to Reuters citing a senior official as saying on Wednesday.

The bank, a collaboration between African Export-Import Bank (Afreximbank) and the African Petroleum Producers Organisation (APPO), aims to bridge funding shortfalls in Africa amidst mounting pressure on major banks to divest from climate-unfriendly energy projects.

Zakaria Dosso, managing director of Africa Energy Investment Corporation (AEICORP), the investment arm of APPO, stated: “Africa should establish its own financing capability to develop this strategic sector.”

Dosso revealed that Ghana recently deposited over $20 million to AEICORP, joining Nigeria and Angola, Africa’s top two crude oil producers, who each contributed $10 million last year.

“Africa Energy Bank is close to realisation and is expected to launch in the latter half of 2024.” Dosso asserted.

It is envisioned that each African member country will contribute a minimum of $83 million, totaling around $1.5 billion, with Afreximbank and APPO matching this sum as founding members.

The remaining $2 billion may come from other investors, including Middle Eastern sovereign wealth funds. Afreximbank did not provide immediate comment.

Regarding the selection of AFE headquarters, Dosso disclosed that six countries – Algeria, Benin, Cote d’Ivoire, Ghana, Nigeria, and South Africa – are vying for hosting rights.

Egypt withdrew its application, leaving Angola, Libya, Senegal, Venezuela, and Afreximbank to assess applicants and present their findings for ministerial consideration.