The Africa Energy Bank (AEB) is positioning itself as a new source of risk capital for Africa’s oil and gas sector at a time when global upstream financing is becoming increasingly constrained.
According to the African Energy Chamber (AEC), the bank is expected to help unlock funding for frontier exploration and energy infrastructure projects across the continent as international oil companies tighten capital spending and commercial banks scale back long-term lending to hydrocarbons.
Global upstream capital expenditure is forecast to reach $504 billion in 2026, but investors are becoming more selective, prioritising capital efficiency and reducing exposure to long-cycle projects. For Africa, which hosts some of the world’s most underexplored yet prospective basins, the pullback has heightened concerns that exploration momentum could stall.
The AEB, spearheaded by the African Petroleum Producers Organization (APPO) and African Export-Import Bank (Afreximbank), was established to address Africa’s energy financing gap, estimated by the AEC at between $31.5 billion and $45 billion annually. The bank has an initial capitalisation of $5 billion and a mandate covering upstream, midstream and energy-linked infrastructure, with a focus on early-stage exploration and appraisal financing.
The bank is expected to grow its balance sheet to as much as $120 billion within three to five years, according to industry estimates cited by the AEC.
Momentum toward the bank’s operational launch is building. Nigeria completed the fully furnished headquarters of the AEB in Abuja in December 2025, while Senegal approved its capital contribution during the same month. Nigeria, Angola and Ghana have already fulfilled their capital requirements, with other APPO member states, including the Republic of Congo, Algeria, Benin, Equatorial Guinea and Ivory Coast, pledging to make payments.
Industry analysts say the AEB’s impact could be most pronounced in frontier oil and gas provinces where geological prospects are strong but financing risks remain high.
In Namibia, recent deepwater discoveries have attracted renewed exploration interest, but advancing appraisal drilling and infrastructure development requires additional capital. TotalEnergies is targeting a final investment decision for its Venus project in 2026, while Galp is progressing its Mopane discovery. Frontier drilling is also underway by Shell, Rhino Resources and Chevron in offshore blocks.
South Africa’s offshore basins are similarly drawing interest, though regulatory complexity and long lead times have increased financing risk. Several operators, including TotalEnergies, Impact Oil & Gas and Shell, are planning multi-well drilling campaigns, while the lifting of a shale gas moratorium in 2025 is expected to spur onshore exploration in the Karoo.
Elsewhere, countries across the MSGBC Basin are seeking partners and capital to advance exploration, hoping to replicate recent offshore successes in Senegal and Mauritania. Ivory Coast, which recorded Africa’s largest oil discovery in 2021, has seen renewed activity, with Murphy Oil Corporation expected to drill new wells in the coming months.
The AEB is also expected to feature prominently at African Energy Week 2026, scheduled for October 12–16 in Cape Town, where policymakers, financiers and operators will discuss new approaches to funding Africa’s energy ambitions.
“Africa does not lack resources or opportunity, it lacks access to capital that understands its realities,” NJ Ayuk, Executive Chairman of the African Energy Chamber, said. “The AEB is about restoring balance, empowering African projects and ensuring the continent controls its own energy destiny.”
