On the sidelines of the 46th session of the Council of Ministers of the African Petroleum Producers Organization (APPO), to be held in Cameroon on November 1, 2024, the institution’s Executive Council met on October 30 in the Cameroonian capital. Progress in discussions on the launch of the African Energy Bank was the main topic on the agenda of this meeting, which brings together almost all the continent’s crude oil-producing countries and aims to create greater synergy between them around the industry’s challenges, notably the financing of oil activities.
One of the most important issues to be addressed by the Executive Board of APPO, the African Petroleum Producers Organization, is the financing and launch of the African Energy Bank. Launched in 2022, the initiative, which requires an initial capital of $5 billion, has already received commitments from APPO member states that will enable it to get off the ground, according to the organization’s executive secretary. Thanks to a partnership with AfreximBank, officials remain optimistic that the financial institution, headquartered in Abuja, Nigeria, will be launched before the end of the first quarter of 2025.
“We were looking for $5 billion to start. But we have decided that we need 500 million to get started. And we’ve gotten 50% of that even before we have formally launched the bank. So we are very comfortable that by the end of the first quarter of next year, we should be able to have the bank running.”
Omar Farouk Ibrahim, secretary general of APPO – Nigeria
75% of Africa’s oil production is exported, as is 45% of its gas production, despite the continent’s energy deficit, according to APPO, the African Petroleum Producers’ Organization. Unfortunately, many Western countries that import these products, having embarked on the energy transition, show less and less interest in it. The African Energy Bank, a pan-African financial institution dedicated to financing oil and gas activities, should enable African countries to move away from dependence on donors for financing oil and gas production, and enable them not only to finance their own development, but also to embark on a smooth energy transition.
“In a certain way, the creation of the African Energy Bank sounds the death knell for the excessive outsourcing of the continent’s oil and gas industry. It is also a strong signal of African ownership of the continent’s oil and gas industry.”
Lejeune Mbella Mbella, Minister of External Relations – Cameroon
Access to energy remains a challenge in Africa. According to the African Development Bank, over 600 million Africans have no access to electricity, and almost a billion people have no access to modern energy. Yet continental reserves of fossil oils, which can be used to generate electricity, are estimated at over 600 trillion cubic meters of gas and 155 billion barrels of crude oil.