Nigeria to host new Africa Energy Bank

Nigeria has been chosen to host the newly formed Africa Energy Bank (AEB), its oil minister said on Thursday, as Africa’s top oil producer beat three rival countries for rights to the multilateral lender. The decision, reached at an extraordinary meeting of the Council of Ministers of the African Petroleum Producers Organisation (APPO), places Nigeria at the forefront of Africa’s energy future, Minister of State Petroleum Resources Heineken Lokpobiri, said in a statement. Nigeria’s bid to host the AEB was strengthened in late May after it ratified the bank’s charter and President Bola Tinubu approved a $100 million investment to the bank, greater than the required $83.33 million for member states.

The fossil fuel-focused bank, a partnership between Afrexim Bank and APPO, aims to fund energy projects on the continent and support its energy transition goals. “This decision reflects our collective ambition to create African solutions to African energy challenges,” Lokpobiri said. The African Energy Bank will be instrumental in providing the necessary financial backbone for energy projects that will drive growth and development across the continent,” he added. The AEB initially has $5 billion to spend when it takes off later this year. Analysts said that Nigeria, as a founding member of APPO and Africa’s top energy producers, has shown strong interest in the bank as the country makes a new push for investment into its lagging oil and gas industry.

“Hosting the bank would be a vote of confidence in Nigeria at a time its energy industry badly needs a boost,” Clementine Wallop, director for sub-Saharan Africa at political risk consultancy Horizon Engage, said before the announcement was made. The three other countries that vied to host the AEB are Algeria, Benin and Ghana, after Ivory Coast and South Africa didn’t meet the necessary requirements.