Nigeria’s Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, announced that the African Export-Import Bank (Afreximbank) has committed $1.75 billion to the establishment of the African Energy Bank (AEB), which Nigeria won the right to host in July 2024.
Contrary to claims of a $19 billion investment, the AEB’s initial capital base is set at $5 billion, with projections to grow to $120 billion within five years. The bank, a joint initiative with the African Petroleum Producers’ Organization (APPO), aims to finance oil and gas projects across Africa, addressing chronic underfunding in the continent’s energy sector.
Lokpobiri, speaking after a meeting with Afreximbank President Benedict Oramah in Abuja, described the AEB as a transformative step for Africa’s energy security. Nigeria secured the hosting rights after meeting six criteria, including providing a headquarters building, free land, and surpassing the 1.5% funding contribution required from APPO’s 18 member countries. Only Ghana and South Africa opposed Nigeria’s bid, with the latter favoring Johannesburg. The AEB, set to begin operations in Abuja by September 2025, will support projects like Nigeria’s Dangote Refinery and Angola’s Lobito Refinery, fostering job creation and industrialization.
Afreximbank’s $1.75 billion equity investment, matched by APPO’s $1.5 billion from member states, forms the bulk of the initial capital, with $2 billion expected from external investors, including Middle Eastern sovereign wealth funds. The bank’s establishment aligns with the African Union’s Agenda 2063, aiming to reduce reliance on foreign financing, which often comes with stringent conditions.
Lokpobiri highlighted Nigeria’s robust oil and gas portfolio, including 37 billion barrels of crude reserves, as a key beneficiary, with the AEB expected to unlock $500 billion in energy investments by 2030. Challenges remain, including finalizing agreements within 90 days and ensuring equitable project distribution, but the initiative marks a significant step toward Africa’s energy independence.