The Independent Petroleum Producers Group (IPPG) has called for the establishment of a robust indigenous financing system to fund Africa’s energy sector, as foreign capital increasingly retreats from the continent.
Speaking at Africa Oil Week 2026 in Accra on Tuesday, IPPG Chairman Adegbite Falade warned that more than 150 essential oil and gas projects have stalled across Africa amid declining investment, posing a direct threat to jobs, energy security and economic transformation.
Falade, who is also the Chief Executive Officer of Aradel Holdings Plc, highlighted the paradox of a continent rich in resources but crippled by energy poverty, noting that Africa holds 125 billion barrels of proven oil reserves and 620 trillion cubic feet of natural gas, yet attracts only about 2% of global renewable energy investment.
“Africa is resource rich and energy poor. The continent has 125 billion barrels of proven oil reserves and 620 trillion cubic feet of proven natural gas,” he stated.
This capital retreat comes at a precarious moment, he argued, particularly as Africa accounts for less than 3% of global greenhouse gas emissions while housing approximately 18% of the world’s population.
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The situation has been exacerbated by the withdrawal of international oil companies from onshore assets across the continent. However, this divestment has created opportunities for indigenous operators, with Nigerian firms now accounting for more than half of national oil production for the first time.
Indigenous Financing Success Stories
Despite the challenges, there are notable examples of indigenous financing succeeding where traditional international funding has faltered. The Renaissance Africa Energy consortium, comprising five local firms, completed the acquisition of Shell’s onshore and shallow water assets in Nigeria for $2.4 billion using entirely indigenous capital.
Tony Attah, Managing Director of Renaissance Africa Energy, described this as a landmark achievement that proves Nigerian firms can execute multi-billion dollar deals without offshore lenders.
Similarly, Heirs Energies secured a $750 million dual-tranche Senior Secured Reserve-Based Lending facility with the African Export-Import Bank (Afreximbank), which was named Best Oil & Gas Deal of the Year at the EMEA Finance Project Finance Awards 2026.
The transaction demonstrated that African institutions can successfully mobilise capital for transformational African businesses, according to Afreximbank’s Haytham ElMaayergi.
Leveraging Domestic Capital
Industry leaders are increasingly pointing to Africa’s vast pool of domestic capital as the solution. NJ Ayuk, Executive Chairman of the African Energy Chamber, noted that Africa sits on $400 billion in pension funds, which could be channeled into closing the energy deficit. Nardos Bekele-Thomas, CEO of the African Union Development Agency (AUDA-NEPAD), put the figure even higher, stating that African pension funds hold $1.5 trillion in assets under management.
However, structural barriers have historically prevented these funds from participating in infrastructure equity. Rachel More-Oshodi, CEO of ARM-Harith Infrastructure Investments, noted that many African pension funds have been unable to participate meaningfully because investment vehicles often failed to match their risk, tenure and currency requirements.
Innovative Financial Instruments
Calling for innovative indigenous solutions, Falade said: “If Africa is to secure its energy future in an era of international capital retreat, we must look inward and build our own institutional and financial resilience.”
Various reports have highlighted emerging new financing mechanisms to address the challenges. ARM-Harith recently achieved a first close of approximately $76 million for its Climate Transition Fund, Africa’s first integrated multi-currency blended finance platform for infrastructure equity. The fund, targeting a final close of $200 million, allows investors to participate in both US dollar and local currency denominations, directly addressing the currency mismatch that has historically deterred domestic institutional participation.
The African Development Bank has played a catalytic role, with its Sustainable Energy Fund for Africa providing $20 million in de-risking capital to anchor the ARM-Harith fund.
The Role of the African Energy Bank
The IPPG chairman also stated that the African Energy Bank (AEB) set for launch in October this year, would play a critical role in indigenous financing architecture.
The AEB, which was established by the African Petroleum Producers Organisation (APPO) and Afreximbank, has been hailed by various stakeholders as an important step toward financing Africa’s energy future.
Balancing Energy Mix
While advocating indigenous financing, industry leaders have also pushed back against what they see as unrealistic expectations about Africa’s energy transition.
Attah argued that while solar and batteries are ideal for households, fossil fuels will remain the dominant power source for heavy industries.
He positioned renewables as a complement to, rather than a replacement for fossil fuels in the global energy mix.
Falade echoed this sentiment, urging African countries to pursue an energy transition that accounts for the continent’s development needs, arguing that cleaner energy deployment should not prevent countries from using natural gas resources to address energy poverty.
The IPPG also called on African governments to urgently restore investor confidence by providing stable fiscal terms, de-risking projects and accelerating regulatory approvals.
The group has also urged reforms to capital access and fiscal frameworks, warning that structural barriers threaten to undermine recent gains in domestic energy production.
Indigenous energy firms have advocated tax reliefs and innovative funding solutions to overcome operational challenges.
Falade concluded that Nigeria’s energy future must be defined by “self-sufficiency, competitiveness, and collaboration,” calling for accelerated infrastructure investment through public-private partnerships and streamlined regulatory processes.
Victor Ezeja is a Nigerian journalist skilled in producing insightful news analyses, feature stories, and interviews that simplify complex issues and drive informed public discourse. His work combines rigorous research, balanced reporting, and compelling storytelling to highlight developments shaping industries and society. Victor, who holds a Master's Degree in Mass Communication, specializes in energy, aviation, business, and economic reporting. He can be reached via @VICTOREZEJA on X