The African Export–Import Bank (Afreximbank) has earmarked $3bn to finance the purchase of refined products within Africa.
This initiative aims to bolster the continent’s refining capacity and reduce its dependence on imported refined products, reported Reuters.
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Africa currently exports around 80% of its crude oil and 45% of its natural gas, highlighting its reliance on imports for refined products.
Afreximbank’s $3bn revolving intra-African oil importing financing initiative will support the purchase of products such as premium motor spirit, automotive gas oil, heavy fuel oil, jet fuel and kerosene.
“The time has come for Africa to take control of its energy destiny,” said Afreximbank executive vice-president Kanayo Awani at an energy conference in Cape Town, South Africa.
Afreximbank has invested in key projects like the 650,000-barrels-per-day Dangote refinery in Nigeria and the Lobito and Cabinda refineries in Angola.
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By GlobalDataTraditionally, the bank has financed imports of refined products from outside Africa.
The continent spends an estimated $30bn annually on petroleum imports due to inadequate refining capacity, according to Awani.
In Nigeria, increased investments have created 1.3 million barrels per day (mbbl/d) of refining capacity, establishing the Gulf of Guinea as a significant refining hub.
“Our goal is to support 3mbbl/d of refining capacity in the near to medium term, that is our ambition,” Awani added.
A joint report by energy consultancy CITAC and Puma Energy indicates that the demand for cleaner fuels in Africa is projected to rise by 56% from 2022 levels, reaching 142 million tonnes (mt) by 2040.
In July last year, the African Petroleum Producers Organisation (APPO) urged member countries to contribute their $83m subscription fees to establish the Africa Energy Bank (AEB).
The AEB, formed through a strategic partnership between APPO and Afreximbank, aims to address Africa’s critical financing needs in the oil, gas and broader energy sectors.
