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Africa spends more than $120 billion a year importing refined petroleum products and hydrocarbon-related services, even though it has some of the world’s largest oil and gas reserves, Nigeria’s petroleum minister said.
Heineken Lokpobiri, Nigeria’s Minister of Petroleum Resources (Oil), made this revelation on Tuesday during the ongoing Nigeria International Energy Summit (NIES) in Abuja.
Lokpobiri said the continent’s overreliance on imports is a financial burden and a missed opportunity for economic transformation.
“Africa currently spends over $120 billion annually on hydrocarbons alone, a staggering outflow of capital,” Lokpobiri said.
“This level of expenditure, primarily on the importation of refined petroleum products and other hydrocarbon-related services, represents not just a financial cost, but a lost opportunity for economic transformation.”
He noted that retaining even a portion of that spending within Africa through local value addition, infrastructure development, and industrial participation would have a transformative economic impact.
Lokpobiri then called for support for the African Energy Bank (AEB), which is expected to be headquartered in Nigeria, warning that failure to mobilise resources to solve Africa’s energy challenges would worsen poverty as the population grows.
“That is why we should support the African Energy Bank with its headquarters in Nigeria. If we do not mobilise the appropriate resources to solve our energy problems in Africa, our misery will increase as our population grows; the responsibility is ours and ours alone,” he said.
He added that Nigeria, as the host country, has fulfilled its obligations toward the bank’s establishment, saying, “The ball is in the court of the promoters to set the ball rolling.”
“Ultimately, this shift is not merely about energy self-sufficiency; it is about economic sovereignty, industrialisation, and inclusive growth.”
The minister also stressed that Africa’s energy strategy must go beyond self-sufficiency to focus on economic sovereignty, industrialisation and inclusive growth.
According to him, retaining hydrocarbon value on the continent would help create fiscal space to fund healthcare, education, infrastructure, security, and technology.
Lokpobiri also said governments must address the energy trilemma of availability, accessibility, and affordability, insisting that oil and gas will remain central to Nigeria’s energy mix.
“No country in the world is abandoning oil and gas, and you can be rest assured that Nigeria will not either,” he said.
“This is more so in the face of new realities that we find in reports, such as the International Energy Agency (IEA) world outlook 2025, OPEC world outlook 2025, and several other reports on global energy, which show that the world is moving from conversations around transition to conversations around energy mix.
“Both reports posit that in the foreseeable future, fossil fuels will be the dominant energy source globally,” Lokpobiri added.
Financing Remains the Biggest Obstacle
Africa’s challenge, according to Farid Ghezali, Secretary General of the African Petroleum Producers’ Organisation (APPO), is not only to extract resources but also to turn them into genuine value for the continent’s people.
Ghezali said Africa exports about 70 percent of its crude oil and 45 percent of its natural gas, resulting in annual value losses estimated at $15 billion that could otherwise be generated locally, particularly in the midstream and downstream sectors.
According to him, “Financing remains the main bottleneck hindering the development of our strategic projects. More than 150 essential projects, from refineries to pipelines, such as the AKK pipeline, to gas infrastructure remain blocked because the cost of financing in Africa is 15-20 percent compared to only 4-6 percent in Asia.
“This disparity is unacceptable and slows down our progress. In addition, the fragmentation of our energy financial ecosystem is a challenge. Our 18 national oil companies in APPO often operate in isolation, without a common stock exchange, which severely limits regional synergies and our collective ability to attract massive capital.”
To address these challenges, Ghezali said APPO is backing the African Energy Bank, which is expected to launch in the first half of 2026.
“The bank is much more than just a financial institution,” he said.
“It is a pan-African platform for the exchange of equipment, energy services and, above all, a catalyst for innovative financing to support structuring African energy projects.”
He added that the bank is designed to help unlock about $200 billion needed for Africa’s midstream and downstream projects by 2030, urging the continent to “produce what we are consuming and consume what we are producing.”
