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February 28, 2024

Nigeria gets 60% Afreximbank energy sector funding – Oramah

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 The African Export-Import Bank (Afreximbank), says  Nigeria is among the largest beneficiaries accounting for about 60 per cent of its US$30 billion funding of the energy sector in Africa.

The Afreximbank said it has been able to make modest contributions in the oil and gas sector because the bank was predominantly African in ownership and control.

Prof. Benedict Oramah, President of the African Export-Import Bank, said this on Wednesday at the ongoing 7th Nigeria International Energy Summit (NIES 2024) in Abuja on Wednesday.

The News Agency of Nigeria (NAN) reports that the Afreximbank President spoke on “Sustainable Strategies for Energy Leadership: Navigating Security, Transition and Finance in a Changing World”.

“The support provided to the sector by Afreximbank is in excess of US$30 billion. Nigeria has been one of the largest beneficiaries accounting for almost 60 per cent of the total funding of the sector.”

Oramah, represented by Haytham Eimaayergi, Executive Vice President, Global Trade Bank (GTBA), said the continent lacked extensive traditional energy infrastructure.

This, he said, presented an opportunity for leapfrogging in a more efficient way to renewable technology.

According to him, “our aspiration in the area of energy security and energy transition will remain aspiration unless we have access to adequate funding resources that we control.”

He said with a lot of international banks withdrawing funding out of the oil and gas sector, the investment in the industry had become limited with the corresponding impact on exploration and production.

“Afreximbank has intervened in a big way, quickly becoming the largest financier of oil and gas deals in the continent,” he said.

The president stated that Afreximbank and Africa Petroleum Producer Organisation (APPO) are in the final stages of setting up the African Energy Bank.

He explained that the Africa Energy  Bank which is being set up under a multilateral financial institution agreement will focus on providing funding for the energy sector in the continent.

He added that it was structured to ensure African origin and control.

“Afreximbank is committed to helping manage and operate Africa energy bank to ensure that it has the best possible chances of success.

“The strategic goal of the Africa Energy Bank is to play a leadership role in shaping the energy landscape in Africa, through strategic partnerships with proven African and international financial institutions and investors.

“It will also provide sustainable financing in the area of the oil and gas sector,” he said.

He, however, appealed for support from member states to achieve the level of capitalisation that would be adequate to support the energy sector.

NAN reports that Secretary-General of African Petroleum Producers Organisation (APPO), Dr Omar Ibrahim, had earlier announced that the decision on which country the proposed African Energy Bank will be sited, is to be taken by the end of first quarter of 2024.

Seven countries including Nigeria, Algeria, Egypt, Ghana, South Africa, Benin Republic, Cote d’Ivoire are jostling for it.