Africa Energy Bank looks beyond oil wells for its first investments
ABUJA — Regional refineries and cross-border pipelines are among the first projects the new Africa Energy Bank intends to finance as international lenders pull back from oil and gas. The African Export-Import Bank (Afreximbank) and the African Petroleum Producers’ Organisation (APPO) formally established the lender in Abuja on 31 October with $5 billion in authorised capital. It expects to make its first investment decisions in 2027.
How much capital has been paid in?
The $5 billion figure sets the ceiling on the share capital the bank can issue. Ahead of the launch, Helen Brume, Afreximbank’s director of project and asset-based finance, told African Energy Week in Cape Town that shareholders had paid in $500 million. That put the bank’s initial capital at one tenth of the authorised amount.
At the inaugural meeting, shareholders appointed Egyptian banker Helmy Ghazi as the bank’s first president and constituted its board. One of the bank’s aims is to bring other financial institutions into oil and gas deals alongside it, according to APPO. For developers seeking to finance a refinery or pipeline, the value of the new lender will therefore depend partly on how much additional capital it can attract to individual projects.
Why pipelines and refineries come first
The founders see a gap between the projects African producers want to build and those traditional lenders are willing to back as they reduce fossil fuel financing. Their initial focus extends beyond extraction. A regional refinery can process crude for several markets, while a cross-border pipeline can give producers a route to customers beyond their domestic market.
APPO’s secretary general cited the proposed Central African Pipeline System, which would span six countries, as an example of the infrastructure the bank wants to support. It remains a prospective project. The first financing decisions expected in 2027 will show which developers secure backing and which other lenders are prepared to invest alongside the bank.
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