…as initial capital for Africa Energy Bank
Ghana is expected to raise an amount of US$83m for its subscription to the initial capital of the Africa Energy Bank(AEB) by March 31, 2024, a parliamentary report has revealed.
This was contained in a Report of the Committee on Mines and Energy for and concerning the agreement for the establishment of the Africa Energy Bank, Charter of the Africa Energy Bank, Headquarters agreement between the government and the Africa Energy Bank.
According to the report, the government has asked the GNPC, which is expected to be a key beneficiary of the setting up of the AEB, to apply GNPC Explorco proceeds to pay for Ghana’s equity in the Africa Energy Bank.
The government is also encouraging fund managers of the Ghana Heritage Fund to invest in the initial share subscription of the Africa Energy Bank.
“In view of Ghana’s decision to bid for the hosting of the bank, the nation must be the best example of subscription payments” the report captured.
The establishment of the AEB offers significant benefits to Ghana including leveraging Ghana’s membership to obtain funding support for the country’s exploration and production operations, providing funds for upstream oil and gas infrastructure projects or logistics support like pipelines, rehabilitation of refineries or building new refineries.
Ghana can also take advantage to secure funding support from the AEB to maintain existing infrastructure, provide support for the development of regional markets to boost the prospects of Ghana’s petroleum and petro-chemical hub as well as provide markets for natural gas and power produced in Ghana in particular.
Parliament’s Mines and Energy Committee in voting to adopt the report and ratify the documents for the creation of AEB reckons it would be of tremendous benefit to the Members of APPO including Ghana. It would provide access to capital for the exploration, production and marketing of oil and gas, and the development of technology and skills in various part of the continent.
The African Petroleum Producers’ Organisation (APPO) formerly called the African Petroleum Producers’ Association, APPA was established on January 27, 1987 in Lagos, Nigeria to serve as a platform for cooperation, harmonization of efforts, collaboration and sharing of knowledge and expertise among African Oil Producing Countries.
On 25th June, 2021 , the Council of Ministers of the APO at its 28th meeting unanimously adopted the admission of Ghana as a member of the APPO. The Parliament of Ghana ratified Ghana’s membership to APPO in May,222, which led to its formal admission into the organization at its 43rd Council meeting in Congo, Brazzaville on 4th November, 2022.
At this Council meeting, Member Countries resolved to commit to the setting up of an Africa Energy Bank(AEB) to provide, primarily funding for the development of African Regional Energy Infrastructure as a long term strategy to tackle the challenges posed by the global paradigm shift from fossil fuels to clean energy. The Bank would be the catalyst for raising funds for African Member countries.
By Eugene Davis