Host country of Africa Energy Bank not in my hand to determine-APPO Scribe

The Secretary General of African Petroleum Producers’ Organization, (APPO) Dr Ahmed Farouk Ibrahim has said that despite being a Nigeria, it is his responsibility to determine the country which will host the proposed African Energy Bank (AEB) which will come on stream in June 2024.

Dr. Ibrahim stated this in response to requests by some eminent Nigerians to use his position to ensure that Nigeria hosts the bank which  is being established to ensure that Africa  countries do not  depend on the external  sources  for the funding of their oil and deposits.

He said it is not his sole responsibility to decides which member country hosts the bank ,adding that the decision will be made by all the  member countries.

Nigeria, Angola,  Algeria Côte d’Ivoire, Equatorial Guinea, South Africa, Ghana are among the seven members contesting to host the bank.

Speaking on Tuesday in Abuja at the just concluded Nigeria International Energy Summit,(NIES),APPO Secretary General said the association would in March take the final decision on which country the bank will be situated.

“Decision will be made on March 31, 2024, end of first quarter 2024 while delivery should happen at the end of the first half of 2024”, Farouk stated

 Nigeria’s Minister of State for  Petroleum Resources, Oil, Senator Heineken Lokpobiri,  had said that other countries should be able to submit to Nigeria to have the bank headquarters in Nigeria adding that Nigeria had submitted to decision of other members’ state to have APPO headquarters located in Congo.

Lokpobiri recalled that in January 1987, eight oil producing African countries (Algeria, Angola, Benin, Cameroon, Congo, Gabon, Libya, Nigeria, called the founding Members) met in Lagos to formally found the African Petroleum Producers’ Association (APPA).The Headquarters of the Organization is in Brazzaville, Republic of Congo.

Any country seeking to host the bank is expected to pay approximately US$83.4million by March 31, 2024 as its initial subscription capital to the bank.

Ghana’s willingness to host the Headquarters of the African Energy Bank was reaffirmed on September 7, 2023, in Accra during an audience granted by the President of the Republic of Ghana, His Excellency Nana Akufo-Addo to the Secretary General of the APPO, Dr. Omar Farouk Ibrahim, who led a delegation comprising his collaborators and the Managing Director of AEICorp, Zakaria Dosso. At this audience, were also in attendance the Ministers of Finance & Energy of Ghana as well the -CEO of GNPC.

“As a democratic country with good governance, Ghana is the best country to host the Headquarters of the bank,” the President said. A natural place to welcome all of Africa, through this bank, should add its Minister of Finance, Mr. Ken Ofori-Atta. Even if his colleague Energy Minister, Dr. Matthew Opoku Prempeh, recognizes that his country is not a major producer like large producers like Nigeria, Angola, or Algeria, all arrangements are made to meet all the requirements to host the Bank’s headquarters.

The Secretary General of the APPO has, during this audience, explained the context that led to the idea of the creation of the African Energy Bank, resulting from the recommendations of the Study conducted by APPO on the Future of the Oil and Gas Industry in Africa in the light of Energy Transition. This Study has identified three major imminent challenges posed by Energy Transition in the African producing countries, namely, finance, technology/Expertise, and market /infrastructure.

The President of Ghana, after listening carefully to his host, wished to warmly commend APPO pour this initiative which comes at a better moment to sustain the development of the continent for energy security and economic diversification.

In 2022, African Export-Import Bank (Afreximbank) signed an Agreement with APPO according to which both parties will collaborate on the establishment of an African Energy Transition Bank in support of an Africa-led energy transition strategy.

The new institution will accelerate Africa’s economic development, whilst ensuring this progress is compatible with, and complementary to, the Sustainable Development Goals (SDG) as well as the continent’s long-term social and environmental objectives as set out in African Union’s Agenda 2063: The Africa We Want.

The African Energy Transition Bank addresses an urgent and existential need on the continent. Africa stands to experience profound effects from climate change, while the considerable poverty across the continent further disincentivizes a focus on environmental care and sustainability for many populations. Moreover, Africa’s oil and gas industry faces growing pressures as international investment in hydrocarbons diminishes.

While Africa’s transition towards alternative energy sources presents great opportunities for the continent, this transition must be carefully managed to minimise the short-term adverse impacts of the transition while maximizing its longer-term benefits. The new bank’s responsibilities would include the management and encouragement of such a productive transition. APPO member states will be signatories to the Energy Transition Bank’s constitutional documents which will be structured in the form of a multilateral treaty, and invest equity into the new vehicle, whilst Afreximbank will co-invest and advise on the establishment and implementation process.