Nigeria, Angola, and Ghana have fulfilled their capital commitments toward establishing the Africa Energy Bank (AEB), a financial institution designed to address the funding gap in Africa’s oil and gas industry.
This achievement accounts for 44% of the minimum required funding from African Petroleum Producers Organisation (APPO) members to launch the bank’s operations.
APPO’s Secretary General, Dr. Omar Farouk Ibrahim, announced this progress at the recently concluded Congo Energy & Investment Forum.
With an initial capitalization of $5 billion, the AEB aims to finance oil and gas projects across the continent, providing an alternative to Western financial institutions that have reduced support for fossil fuel initiatives due to environmental concerns.
APPO requested each of its 18 member states to contribute $83 million, targeting a total of $5 billion for the bank’s launch.
Beyond Nigeria, Angola, and Ghana, Algeria, Benin, the Republic of Congo, Equatorial Guinea, and Ivory Coast have also pledged to make their contributions, supporting the goal of commencing operations in the first half of 2025.
As sub-Saharan Africa’s largest oil producer, Nigeria offers significant opportunities in the oil and gas sector, including a 2025 bid round.
The implementation of the Petroleum Industry Act (PIA) has introduced regulatory reforms that enhance transparency and attract investment, driving major projects forward.
Recent Final Investment Decisions (FIDs) in Nigeria include TotalEnergies’ $550 million Ubeta Gas Field Development and Shell’s $5 billion Bonga North Project. However, securing additional financing remains crucial to advancing Nigeria’s gas agenda and maximizing its role in the energy transition.
Angola continues to diversify its energy portfolio while progressing with major deepwater developments, such as TotalEnergies’ $6 billion Kaminho Deepwater Project, Eni’s Agogo Integrated West Hub, and a limited public tender aimed at increasing production to 2 million barrels per day.
By 2025, Angola plans to finalize an FID on its first green hydrogen project, a 600 MW development led by Sonangol in collaboration with international partners.
Additionally, Angola is developing its first non-associated gas project, the New Gas Consortium, and expanding the Angola LNG plant with a $12 billion investment to improve gas monetization.
Ghana is strengthening its position in the oil and gas sector through new commitments from Eni and Tullow Oil.
In March, Eni and the Ghana National Petroleum Corporation signed an agreement to enhance offshore exploration, optimize existing assets, and develop untapped reserves.
This agreement follows regulatory reforms aimed at improving fiscal terms, increasing transparency, and incentivizing investment.
Tullow Oil remains a key player in Ghana’s energy sector, with production from the Jubilee and TEN fields supporting economic growth. The company also plans to launch a drilling program in May 2025 to bring new production online.
Beyond hydrocarbons, Ghana is modernizing its infrastructure, expanding energy access, and investing in renewable energy to strengthen long-term energy security.
The establishment of the AEB represents a strategic move to create a financial institution dedicated to Africa’s unique energy needs.
By offering tailored financing solutions, the bank is expected to accelerate energy project development, enhance energy security, and drive economic growth.
As more countries contribute their capital shares, the AEB will play a crucial role in unlocking investment, closing financing gaps, and ensuring sustainable energy expansion across Africa.
Meanwhile, the Nigerian government has urged International Oil Companies (IOCs) operating in the country to increase investments in the oil and gas sector, emphasizing that President Bola Tinubu’s administration has provided the necessary incentives for smooth and profitable operations.
Senator Heineken Lokpobiri, Minister of State for Petroleum Resources (Oil), made this call during the Cross Industry Group (CIG) meeting in Florence, Italy, organized by IOCs operating in Nigeria.
The meeting focused on addressing challenges, setting expectations, and developing strategies to enhance the sector’s contributions to domestic energy needs and regional expansion across sub-Saharan Africa.
Lokpobiri acknowledged that IOCs have cited Engineering, Procurement, and Construction (EPC) contractors as a challenge but noted that EPCs will only commit when they see firm investment decisions from industry players.
He stated, “The government has done its part by introducing investment-friendly policies, including the president’s executive order to incentivize deepwater investments. Now, IOCs and other operators must make strategic decisions to boost production and ensure sustainability.”
Lokpobiri also urged IOCs to support local refining efforts, emphasizing that new refineries coming online will require a steady supply of crude oil.
To facilitate this, he stressed the need to ramp up production to meet both local and international demands.
Reaffirming the government’s commitment to increasing production, Lokpobiri stated that authorities will enforce the “drill or drop” provisions of the Petroleum Industry Act (PIA) when necessary.
He added, “We cannot allow assets to remain idle for 20 to 30 years without development. If an asset remains underutilized for decades, it holds no value for either the investor or the country.”
Encouraging collaboration, Lokpobiri suggested that industry players consider shared resources for neighboring assets, farm-outs, or reallocating underutilized assets to operators willing to invest.
He warned that if operators fail to develop these assets, the government will reassign them to companies ready to put them into production.
Additionally, he urged oil companies to consider farm-out agreements for assets located near existing infrastructure rather than incurring high costs for new Floating Production Storage and Offloading (FPSO) units.
According to Lokpobiri, the federal government remains committed to fostering a thriving oil and gas industry and expects industry players to match this commitment with tangible investments that drive growth, sustainability, and national energy security.
Osagie Okunbor, Chairman of the Oil Producers Trade Section (OPTS), commended the minister for his direct engagement with industry leaders and acknowledged the government’s efforts in advancing the sector.
“We appreciate the government’s commitment to creating a conducive investment environment. The minister’s engagement has provided critical insights and challenged us as industry players to increase production,” Okunbor said.
source: www.thisdaylive.com
