Afreximbank and APPO sign agreement to create the African Energy Bank

The African Export-Import Bank (Afreximbank) and the African Petroleum Producers Organization (APPO) have signed the Agreement and Charter of the African Energy Bank (AEB).

The agreement was formalized at a ceremony at the Ministry of Petroleum and Mineral Resources of the Arab Republic of Egypt, hosted by the Egyptian Minister of Petroleum and Mineral Resources, Tarek El Molla, according to a statement by Vincent Musumba, Head of Communications and Events at Afreximbank.

Professor Benedict Oramah, Chairman of the Board of Afreximbank, and Dr. Omar Ibrahim, Secretary General of APPO, signed the agreement on behalf of their respective institutions. This event marks the culmination of two years of negotiations and preparations, following a memorandum of understanding signed in May 2022 for the creation of the AEB.

The African Energy Bank was created in response to the looming financing crisis in the African oil and gas industry, exacerbated by the global energy transition. Traditional financing is withdrawing due to climate change concerns, leaving Africa in a precarious position. Although AEB focuses on financing oil and gas projects, it is also open to renewable energy projects, with the aim of ensuring the eradication of energy poverty in Africa.

AEB, although born in Africa, welcomes all investors who share its mission and vision. Structured as an independent, supranational pan-African energy development bank, it has an initial capital of five billion dollars. For the bank to become operational, at least two member countries must now sign and ratify the founding documents.

At the ceremony, El Molla, also a member of the APPO Ministerial Council, expressed his honor at witnessing the creation of AEB. He stressed that this moment represents a key step towards energy independence and sustainable development on the African continent. The collaboration between Afreximbank and APPO demonstrates their commitment to stimulating Africa's growth and ensuring energy security for future generations.

Professor Oramah called it a "historic day" for Africa, stressing the importance of balancing the fight against climate change with the need to avoid social upheaval due to difficult economic conditions. He affirmed Afreximbank's pride in co-investing in the AEB and playing a leading role in its management and implementation, with an operational launch scheduled for July.

Dr. Ibrahim added that AEB is Africa's answer to the financing challenge posed by the energy transition. The African oil and gas industry, long dependent on foreign financing, must now turn to African solutions to meet its energy needs. He congratulated Professor Oramah on his exemplary leadership and commitment to the African continent.