The African Export Import Bank (Afreximbank) and the African Finance Corporation (AFC) are each contributing about $16 billion to oil and gas projects all over Africa. At the African Refiners and Distribution Association (ARDA) conference currently taking place in Cape Town, South Africa, this was revealed yesterday. This is coming as stakeholders at the conference urged Africans to keep funds within the continent to finance the over $190 billion yearly energy investment needed on the continent. Afreximbank is investing $15 billion of the banks' investment, while AFC has already put up over $800 million with another $200 million expected to be finalized. Rene Awembeng, Global Head, Client Relations at Afreximbank, claimed that the company's oil and gas portfolio exceeds $15 billion and has a strong pipeline across the entire continent, he noted that the continent must focus on shared infrastructure and be ready to finance itself otherwise projected development may remain elusive. A
wembeng stated that the continent is in a critical situation where demand for energy continues to rise on the backdrop of surging population.that large infrastructure development, including refineries that would meet demand on the continent, must be prioritized and supported because the continent relies primarily on importation of petroleum products at a time when foreign exchange demand is hovering at $100 billion annually and required energy investment annually stands at $190 billion. Worried over the rising prices of imported petroleum products, Awembeng said it was regrettable that Africa remained an importer of all refined products. AFC, Shayo Olumide said AFC has disbursed $800 million towards supporting Africa’s refinery sector with an additional $210 million in its near-term pipeline. Noting the need for sustainable finance, he said priority for the Environment, Sustainability and Governance is necessary for funding consideration, Spoke on Financing Infrastructure Projects to Accelerate Africa’s Energy Transition, Senior Investment Associate,
“Africa has not invested in its refineries or refining capacity. We’ve not invested in our storage facilities. We’ve not invested in our pipelines sufficiently to meet the demand. So with the COVID crisis, and now the Ukraine crisis we are now in a very difficult position.“A lot of the international banks and some of the banks that were financing oil and gas transactions have retreated from Africa for a number of reasons; leaving the burden on African financial institutions and some of the development financiers like the African Export Import Bank to look into the problem.” “The challenge now is we have significant capacity to meet the demand of $190 billion every year to finance oil and gas requirements in Africa. Do we have capacity on the continent to support the $15 billion of rehabilitation of refining capacity required in North Africa, West Africa and East Africa. I don’t think we are. “So we are going into a crisis where if you look at also what is happening with food security in terms of fertilizers and grain, we have to import plus the high costs of importation of refined products. We are in a very challenging situation as a continent to be able to finance oil and gas,” - Awembeng
Guardian
