The Africa Energy Bank, designed to fund oil and gas projects while supporting the continent's energy transition goals, is set to launch in the first quarter of 2025 with a targeted asset base of $120 billion, according to Nigeria's Junior oil Minister.

This fossil fuel-focused bank is a collaborative effort between the trade finance institution Afreximbank and the African Petroleum Producers Organization. Initially expected to begin operations by mid-2024, the launch was postponed. Currently, Nigeria, Africa's leading oil producer, has an average crude output of 1.7 million barrels per day.

 The country secured the right to host this multilateral financial institution, outperforming three other African nations.

To help us understand the significance of this development, Thami Ngubeni spoke to Professor Dayo Ayoade, Law & Policy Specialist in Energy, Extractives and Governance in Nigeria.