Africa Energy Bank to start operation with $5 billion capital

The proposed Africa Energy Bank, aimed at financing oil and gas projects across the continent, is set to launch this year with an initial capital base of $5 billion.

Jointly initiated by Afreximbank and the African Petroleum Producers Organization (APPO), the bank aims to address financial gaps in Africa’s energy sector amid growing pressure on major banks to divest from fossil fuel projects.

Ghana recently contributed over $20 million to the Africa Energy Investment Corporation (AEICORP), making it the third African nation to do so after Nigeria and Angola.

Each had previously contributed $10 million.

According to Zakaria Dosso, managing director of AEICORP, the Africa Energy Bank is expected to become operational in the second half of 2024.

African member countries are expected to contribute a minimum of $83 million each, with Afreximbank and APPO also providing substantial funding.

The remaining $2 billion is anticipated to be sourced from alternative avenues, potentially including Middle Eastern sovereign wealth funds. Six nations, including Algeria, Benin, Cote d’Ivoire, Ghana, Nigeria, and South Africa, are competing to host the bank's headquarters, with Egypt withdrawing its bid.

Dosso stated that the selection committee, comprising Angola, Libya, Senegal, Venezuela, and Afreximbank, will evaluate all applicants before ministers make a final decision.