African oil producers seek $5 billion from the African Energy Bank

The African Petroleum Producers Organisation (APPO) has launched an urgent appeal to its member countries to honour their financial commitments to create the African Energy Bank (AEB), the first financial institution of its kind on the continent.

It is important to remember that Nigeria was recently chosen to host the headquarters of this bank, which will be located in Abuja, the country's capital.

To ensure that the bank is operational, APPO Secretary General Farouk Ibrahim has called for financial contributions from member countries amounting to 83 million dollars, needed to launch the bank in September 2024.

This appeal was launched at the 18th ordinary meeting of the APPO Board of Directors in Brazzaville, Republic of Congo, where the organisation's headquarters are located, according to an official press release signed by the Permanent Secretary of the Ministry of Petroleum, Nicholas Ella.

"We comply with the resolutions adopted by the APPO Council of Ministers last week. We will redouble our efforts to ensure that the necessary funds are raised to launch the African Energy Bank," said Mr Ibrahim.

He also revealed that the member oil-producing countries had officially contacted the Nigerian government to discuss the accelerated measures required to establish the bank.

"On Friday 5 July, we sent an official communication to the Federal Republic of Nigeria. We will be discussing the speed of preparation of the bank's building and the finalisation of the headquarters agreement for signature. We have already obtained one signature from a member country for the establishment agreement. We need a further signature to move forward," said Mr Ibrahim.

Expressing President Bola Tinubu's gratitude to the Member States for their unwavering support and confidence in Nigeria's bid to host the bank, Mr Ella, who led the Nigerian delegation, reiterated his commitment to the continental bloc's ideals of enhancing energy security in Africa.

"The meeting of the 18 APPO member countries in Brazzaville demonstrates our collective commitment to promoting unity, cooperation and sustainable development within the African energy sector", emphasised Mr Ella.

He reaffirmed Nigeria's determination to work with other members to meet the financial needs of the African energy sector by financing oil and gas projects.

Mr Ella urged member countries to harness the collective strength of the continent's nations to build a brighter, more prosperous future for Africa.

"Together, we will create an institution that will meet the financial needs of our energy projects and promote sustainable development, environmental stewardship and economic inclusion across Africa", he added.

At a brainstorming session on the continent's energy future, Algerian Executive Council member Remini Amine stressed the importance of local content, labour and infrastructure development in unlocking Africa's energy potential.

Representatives of APPO member states agreed that the energy bank would fill the financing gap in the sector. Mr Ibe Kachikwu, former Nigerian Minister of State for Petroleum Resources, proposed a ten-year plan for the energy sector to encourage an "open era" for investment. Kachikwu advised APPO to broaden the energy bank's capital base before making investments.

Speakers at the week-long event highlighted the need for national oil companies (NOCs) to lead crude oil production and refine oil to meet local consumption needs. The Energy Bank is a joint initiative of APPO and Afreximbank.