How is Afreximbank looking to scale its financial support for indigenous Angolan companies across the oil and gas value chain?

Angola is an important market for Afreximbank, as we have demonstrated our ability to support large and complex energy transactions through projects and facilities involving the Cabinda Refinery, Amufert, Sonangol and Etu Energias. The next phase, however, must be about extending that same structuring and financing capability to a broader universe of privately owned Angolan companies.

Our ambition is to support viable indigenous businesses move progressively from service provision and contracting into larger roles across the value chain, including asset ownership, operatorship, processing, storage, logistics, power and distribution. To do that, Afreximbank does not approach the market simply as a lender. We provide an integrated combination of advisory, project preparation, structuring, project and trade finance, guarantees and payment solutions.

What financing structures or mechanisms does Afreximbank see as most effective for addressing the financing gap in Angola?

There is significant capital - both within Africa and internationally - looking for credible opportunities. The challenge is often that promising projects are not yet structured in a way that allows that capital to participate.

For a lender or investor, there must be sufficient visibility over the asset, cash flows, governance, execution capability and ultimately the source of repayment. Our role is therefore to support companies bridge the gap between a good commercial opportunity and a bankable transaction.

For companies acquiring or developing producing upstream assets, for example, reserve-based lending can be particularly powerful. It allows future production and reserves to support financing today, enabling indigenous companies to fund acquisitions, development programs and expansion.

Receivables-backed structures can similarly convert predictable commercial flows into financing capacity. Project and acquisition finance, guarantees and risk-sharing arrangements with other DFIs and ECAs can then complement those structures depending on the transaction.

But finance alone is not enough. Through Afreximbank's Intra-African Trade Champions and twinning approach, we can connect emerging Angolan companies with experienced African operators that have already gone through similar growth journeys.

What lessons from Nigeria can be applied to Angola to help local companies acquire assets, expand operations and become larger participants in the industry?

Nigeria provides compelling evidence of what can happen when African entrepreneurship is combined with the right financing, policy environment and execution capability. Oando is a particularly relevant example. It evolved from a downstream business into an integrated energy company and ultimately into the operator of significant upstream assets. Heirs Energies is another example. Through acquisition, investment and operational improvement, the company has developed into an important indigenous producer and a major supplier of domestic gas supporting Nigeria's power sector.

At a broader industrial level, the Dangote Refinery demonstrates the transformative effect of value addition and processing. Rather than exporting resources and importing finished petroleum products, the objective is to process more at home, build homegrown industrial capacity and retain a greater share of the value created within the economy.

That is very much aligned with President George Elombi's broader direction for Afreximbank: to promote and accelerate value addition, build regional value chains and foster homegrown industries. The lesson for Angola is not that Nigeria's model should simply be copied. Angola has its own resources, institutions and industrial structure. The lesson is that African companies can become very substantial energy players when there is long-term ambition, appropriate financing, credible partnerships and disciplined execution.

What does Afreximbank’s $1.75 billion receivables facility for Sonangol demonstrate about the Bank's appetite for Angola's oil and gas sector?

The Sonangol transaction is important not simply because of its size, but because of what it demonstrates about how capital can be mobilized for African energy assets. Afreximbank played a catalytic role by committing its own balance sheet while structuring the transaction in a manner that enabled other financial institutions to participate alongside us.

That is an important part of our model. Our objective is not necessarily to finance every dollar ourselves; it is to use Afreximbank's structuring capability, relationships and risk appetite to crowd additional capital into African transactions.

The receivables structure is also instructive. By linking financing to identifiable commercial flows, lenders obtain greater visibility over repayment. Similar principles can be adapted to different parts of the energy value chain through reserve-based financing, receivables-backed structures, acquisition finance, guarantees and other structured solutions.

Clearly, the size and complexity of a Sonangol transaction are different from the requirements of a mid-sized indigenous company. But the underlying capability is transferable. If we can mobilize very substantial pools of African and international capital around the national champion, then our challenge is to apply the same discipline of structuring and mobilization at appropriate scale to credible indigenous operators. That is how we broaden the financing ecosystem beyond the largest borrowers.