The proposed Africa Energy Bank, which aims to fund oil and gas projects across the continent, is set to start operations by June 2025.
According to Reuters, this information was disclosed by Afreximbank Senior Executive Vice President, Mr Denys Denya, on the sidelines of Africa’s annual Mining Indaba in Cape Town, South Africa.
The bank, a partnership between Afreximbank and the African Petroleum Producers Organization (APPO), is meant to help plug a funding gap in Africa amid pressure on major banks from environmental groups to shift investment dollars away from climate-warming oil and gas projects.
“We are in the capital raising phase. A number of countries have already put in the money, (so) we’re talking to a number of countries to bring in the capital so that we can start trading,” Mr Denya said on Tuesday.
He also disclosed that South Africa has indicated interest to join the new bank.
“Definitely, we’ll start trading this year. We’re hoping that we can start trading before the half-year stage,” he said.
The bank will be headquartered in Nigeria with an initial capitalization of up to $5 billion, offering tailored funding solutions to meet Africa’s energy needs.
Mr Denya said that in addition to Angola, Egypt, Nigeria and Ghana, there were countries – including South Africa – that were not members of APPO that had indicated interest to be part of the bank.
In July 2024, Nigeria was chosen to host the Africa Energy Bank.
Nigeria, which is Africa’s top oil producer beat three rival countries for rights to the multilateral lender after it ratified the bank’s charter and President Bola Tinubu approved a $100 million investment to the bank, greater than the required $83.33 million for APPO member states.
According to Nigeria’s Minister for Petroleum Resources (Oil), Mr Heineken Lokpobiri, this indicates Nigeria’s unwavering commitment to be at the forefront of energy on the continent.