The much-anticipated launch of the $5 billion Africa Energy Bank (AEB) is hanging in the balance following a high-stakes funding dispute between the African Petroleum Producers Organisation (APPO) and the African Export-Import Bank (Afreximbank).
The AEB, designed to be Africa’s premier energy-focused financial institution, was conceived to plug a critical financing gap caused by the retreat of global lenders from oil and gas projects. However, a disagreement over the transfer of equity subscription funds has now thrown its timeline into serious doubt.
In a strongly worded letter to APPO Secretary-General Dr. Omar Farouk Ibrahim, Afreximbank warned that the organisation’s stance on withholding funds until after the official launch could derail the entire project. Afreximbank argued that the transfer of equity subscription funds into the AEB Equity Investment Account was a non-negotiable precondition for establishing the bank.
Farouk, however, maintained that APPO could not “unilaterally transfer” money from its escrow account without first securing the headquarters, appointing a president, and fixing a launch date.
But Afreximbank countered, stressing that without the funds, key steps — including shareholder confirmation, board elections, and presidential appointments — could not proceed. It warned that the delay was now creating a “reputational risk” for all parties involved.
The bank reminded APPO of Article 45.1 (a) of the AEB Charter, which requires that at least $1.25 billion in initial share capital be subscribed and paid by at least two eligible members before the inaugural general meeting can take place. Afreximbank also revealed that its board had amended approvals in March 2025 to invest up to $750 million nominal equity — with $300 million paid-in — to match APPO member states’ contributions.
Despite repeated appeals, the delay persists. Afreximbank has proposed immediate compliance with the charter, setting out strict target dates for fund transfers, board appointments, and operational launch.
The revised schedule calls for:
July 20, 2025 – Deposit of subscription funds into the AEB account.
August 18, 2025 – Constituent assembly meeting to review progress and nominate directors.
August 29, 2025 – Completion of interviews for the AEB President role.
September 18, 2025 – Inaugural general meeting to adopt the charter, elect leadership, and ratify the headquarters.
September 30, 2025 – Formal launch of the bank.
If these steps are not met, industry observers fear the bank could be postponed indefinitely — possibly until after Farouk’s retirement at the end of 2025.
The Africa Energy Bank is seen as a strategic tool to support Africa’s energy security, financing projects that would otherwise struggle to secure backing amid global shifts toward renewable energy. APPO has asked its 18 member states to contribute $83 million each, targeting an initial $5 billion capital base.
So far, Nigeria, Angola, and Ghana have fulfilled their commitments, representing 44% of the required capital from APPO members. Several other countries, including Algeria and Ivory Coast, have pledged payments, but the dispute threatens to stall momentum.
In 2024, President Bola Tinubu approved a $100 million investment by Nigeria for Class A shares in the AEB, underlining the country’s commitment to the initiative.
Energy sector analysts warn that the stalemate could undermine investor confidence in Africa’s ability to coordinate large-scale, multi-country financial projects. With global capital increasingly shifting toward clean energy, the AEB’s launch is seen as a critical opportunity for African producers to maintain investment in oil, gas, and related infrastructure.
For now, all eyes are on whether APPO and Afreximbank can bridge their differences. The coming weeks will determine whether the Africa Energy Bank becomes a reality — or remains a missed opportunity in the continent’s pursuit of energy independence.