Afreximbank Strengthens Angola’s Oil Sector with Strategic $1.75 Billion Sonangol Financing

The African Export-Import Bank (Afreximbank), working alongside other mandated lead arrangers, has successfully closed a $1.75 billion syndicated receivables purchase facility for Sonangol, Angola’s state-owned national oil company. The landmark transaction, announced on January 28, 2026, represents one of the most significant trade finance facilities structured for an African energy company in recent years, underscoring the continent’s growing capacity to mobilize substantial capital for strategic sectors through African-led financing mechanisms.

The strategic financing is specifically designed to support Sonangol’s projected operating and capital expenditure requirements while advancing Afreximbank’s institutional mandate to promote African-led financing models that support economic growth, industrialization, self-reliance, and sovereignty across member states. The facility comes at a critical juncture for Angola’s petroleum sector, which continues to serve as the backbone of the nation’s economy, accounting for approximately 75 percent of government revenues despite production challenges in recent years.

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Innovative Financing Structure and Risk Mitigation

Afreximbank played a catalytic, balance-sheet-led role in the financing, structuring, and syndication of the facility, which is carefully designed to provide sustainable funding to the Angolan oil and gas sector while ensuring strong repayment assurance for lenders. The Cairo-based multilateral financial institution worked closely with international banking partners to craft what industry observers describe as an innovative and sophisticated financing framework that addresses several traditional challenges associated with commodity-linked lending.

In line with the Bank’s strategic approach of supporting African business champions in critical sectors, Afreximbank helped design an innovative, de-risked structure that specifically mitigates oil price volatility—a perennial concern for petroleum-dependent economies and their lenders. The financing framework allows for flexible security arrangements, easing traditional collateral requirements while maintaining robust protection mechanisms for participating financial institutions. This approach represents an evolution in African trade finance structuring, demonstrating how continental institutions are developing increasingly sophisticated risk management frameworks.

The receivables purchase structure provides Sonangol with immediate liquidity backed by future export proceeds, a mechanism that has proven effective in commodity trade finance globally. By structuring the facility around receivables rather than traditional secured lending, Afreximbank and its partners have created a framework that offers flexibility while providing lenders with strong repayment assurance tied directly to the company’s commercial operations and export flows.

Strategic Importance for Angola’s Energy Sector

The $1.75 billion facility carries significant strategic implications for Angola’s petroleum industry and broader economic development trajectory. Angola currently produces approximately 1.03 million barrels per day as of early 2025, representing a notable decline from the country’s peak production of around 2 million barrels per day achieved in 2008. This production decline reflects a combination of natural field depletion, underinvestment in new exploration and development, and technical challenges across Angola’s offshore production infrastructure.

The facility is expected to enable Sonangol to meet its operating and capital needs by strengthening export-linked trade structures, directly supporting Afreximbank’s objective of increasing Africa’s share of global trade and reinforcing the export of strategic commodities. For Angola, maintaining stable oil production and export capacity remains essential for macroeconomic stability, as petroleum revenues generate 90-95% of the nation’s merchandise exports and 55-65% of government budget receipts.

Haytham Elmaayergi, Executive Vice President of Global Trade Bank at Afreximbank, articulated the transaction’s broader significance: “This $1.75 billion syndicated receivables facility underscores Afreximbank’s commitment to supporting African energy champions and safeguarding export capacity that is critical to our member states’ macroeconomic sovereignty and trade resilience. By deploying innovative structures that provide comfort to lenders while easing traditional security requirements, we are able to crowd source much needed capital into strategic sectors.”

He further emphasized the facility’s multifaceted impact: “The transaction will help Sonangol meet its operating and capital needs, sustain export flows, increase energy availability, and support Angola’s broader industrialization and economic transformation, while directly contributing to increased African participation in global trade.”

Context: Angola’s Oil Sector Challenges and Opportunities

Angola’s petroleum industry operates within a complex landscape of declining legacy production, ambitious downstream development plans, and evolving regulatory frameworks. The country exited OPEC at the end of 2023, arguing that production quotas no longer reflected its operational capacity as output had slipped to levels that made quota compliance increasingly challenging. This decision reflected pragmatic recognition of the nation’s production constraints while providing greater flexibility in managing output and exports.

Sonangol, founded in 1976 following Angola’s independence from Portugal, has undergone significant restructuring in recent years. A major institutional reform in 2019 transferred upstream concessionaire rights from Sonangol to the National Agency for Petroleum, Gas and Biofuels (ANPG), which now serves as the sector’s upstream regulator responsible for concession block awards and contract management. This reform was designed to improve transparency and efficiency by separating Sonangol’s operational activities from regulatory functions, allowing the company to focus on upstream, midstream, and downstream operations while divesting many non-core business units.

The company has also been pursuing an ambitious downstream expansion strategy, including the development of three major new refineries that would dramatically increase Angola’s petroleum refining capacity from its current 65,000 barrels per day to approximately 425,000 barrels per day. These refining projects—the Cabinda, Soyo, and Lobito facilities—are estimated to reduce refined petroleum imports by approximately $2.7 billion annually once operational, generating substantial savings while supporting economic diversification efforts.

The Afreximbank facility comes just days after Sonangol achieved another significant financing milestone by raising $750 million through its first-ever international bond issuance. The five-year US dollar-denominated bond, issued around January 22, 2026, carried a fixed coupon of 10% and was structured as a private placement with Standard Chartered Bank acting as sole arranger and bookrunner. Together, the Afreximbank facility and the international bond illustrate Sonangol’s multi-pronged financing approach, combining African development finance with global capital-market instruments to meet diverse funding requirements.

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Afreximbank’s Expanding Role in African Trade Finance

The Sonangol facility exemplifies Afreximbank’s increasingly prominent role in mobilizing capital for strategic African industries and supporting the continent’s economic transformation. The pan-African multilateral financial institution has demonstrated remarkable growth in its trade finance activities, with the bank having disbursed more than $17.5 billion in trade finance during 2024 alone. The institution has set ambitious targets to increase this amount to $40 billion by 2026, reflecting both growing demand for African trade finance solutions and the bank’s expanding capacity to structure and syndicate large-scale transactions.

According to Afreximbank’s recently released African Trade Report 2025, Africa’s total merchandise trade recovered strongly in 2024, surging by 13.9% to $1.5 trillion following a 5.4% contraction in 2023. Intra-African trade also demonstrated robust growth, increasing by 12.4% to reach $220.3 billion, reflecting the early tangible benefits of African Continental Free Trade Area (AfCFTA) implementation even as the continent contends with rising inflation, sovereign debt pressures, and a persistent trade finance gap estimated at approximately $100 billion annually.

Professor Benedict Oramah, President and Chairman of the Board of Directors of Afreximbank, has emphasized that the institution’s role extends beyond mere financing to actively reshaping Africa’s position in global economic architecture. The bank has championed the Pan-African Payment and Settlement System (PAPSS), which was adopted by the African Union as the payment and settlement platform to underpin AfCFTA implementation, helping reduce reliance on foreign currencies and making cross-border trade more efficient across the continent.

At the end of December 2024, Afreximbank’s total assets and contingencies stood at over $40.1 billion, with shareholder funds amounting to $7.2 billion. The institution maintains investment-grade ratings from multiple international rating agencies, providing confidence to international investors and banking partners participating in syndicated facilities such as the Sonangol transaction.

Impact on Angola’s Economic Development and Industrialization

The facility is expected to support Angola’s economic development trajectory by enabling sustained extraction and commercialization of natural resources, strengthening export proceeds, and reinforcing industrialization and value creation initiatives across the broader economy. For a nation where petroleum activities contribute approximately 45% to GDP and the vast majority of export revenues, maintaining operational capacity and production stability in the oil and gas sector remains fundamental to overall economic performance and fiscal sustainability.

Angola’s government has articulated an ambitious vision for the energy sector, with Secretary of State for Oil and Gas José Barroso stating: “We have already laid the foundations, so 2026 will be the year to convert projects into production and into real economic impact. Angola is open, ready, and fully equipped to ensure solid and profitable investments. 2026 will be the year to mobilize, invest, and define the next 50 years of our energy sector.”

The country’s upstream regulator ANPG is pushing a $60 billion investment drive across Angola’s upstream oil and gas industry between 2025 and 2030, led by a series of ambitious exploration and production projects designed to arrest production decline and potentially restore output growth. Major international oil companies including TotalEnergies, Chevron, ExxonMobil, BP, and Eni continue to maintain significant operations in Angola, with several announcing new project developments and production startups that could add tens of thousands of barrels per day of new capacity.

The New Gas Consortium is also advancing Angola’s first non-associated gas project toward full operational capacity following its operational start in 2025, which will enhance feedstock for Angola LNG and domestic power generation plants while strengthening gas export capacity. These gas development initiatives complement ongoing oil production efforts and represent important diversification within the broader hydrocarbon sector.

The Afreximbank facility provides Sonangol with the financial resources necessary to maintain production from existing fields, fund necessary infrastructure maintenance and upgrades, and potentially participate in new development opportunities as they arise. Sonangol has set ambitious targets for increasing its share of national oil and gas production from approximately 2.8% to 10% by 2027, requiring substantial capital investment in both production operations and technical capacity.

Broader Implications for African Energy Financing

The successful structuring and syndication of this $1.75 billion facility carries implications that extend well beyond Angola’s borders, demonstrating the maturation of African financial institutions’ capacity to mobilize substantial capital for complex commodity-linked transactions. The deal showcases how continental institutions like Afreximbank can leverage their deep understanding of African markets, regulatory environments, and political economies to structure transactions that might prove challenging for institutions without similar contextual expertise.

The transaction also reflects growing confidence among international lenders in well-structured African commodity finance deals, particularly when African multilateral development banks play anchor roles providing credit enhancement and risk mitigation. By taking a balance-sheet-led approach and working closely with mandated lead arrangers, Afreximbank has effectively de-risked the transaction sufficiently to attract broad syndicate participation.

This model of African-led deal structuring with international syndicate participation represents an important evolution in continental finance, moving beyond traditional bilateral relationships or purely external financing arrangements toward hybrid structures that combine African institutional knowledge and balance sheet capacity with international capital markets access. Such approaches can potentially be replicated across other African nations and sectors, supporting the development of more robust and diversified financing ecosystems across the continent.

The facility’s timing also proves strategically significant as Angola continues implementing broader economic reforms designed to improve the business environment, enhance fiscal discipline, and attract foreign investment across multiple sectors. While the petroleum industry remains dominant in the near term, the government has articulated clear objectives around economic diversification, with petroleum revenues providing the fiscal space necessary to invest in alternative economic sectors including agriculture, manufacturing, infrastructure, and services.

Looking Forward: Angola’s Energy Transition and Economic Outlook

As Angola navigates the complex intersection of maintaining hydrocarbon production, developing downstream refining capacity, and positioning for longer-term energy transition dynamics, access to flexible, substantial financing arrangements becomes increasingly critical. The Afreximbank facility provides Sonangol with multi-year financial support that can accommodate the cyclical nature of oil and gas operations while supporting strategic investments necessary for sustained competitiveness.

Angola faces the challenge common to many petroleum-dependent economies of managing the delicate balance between maximizing value from existing hydrocarbon resources during the remaining decades of strong global demand while simultaneously investing in economic diversification that can provide alternative revenue sources as the global energy transition progresses. The successful execution of downstream refining projects could significantly reduce the country’s refined product import bill while creating additional value-added industrial activity domestically.

The nation is also pursuing opportunities in renewable energy and gas-to-power initiatives that could help address domestic energy access challenges while potentially creating new export opportunities. Angola’s abundant solar resources, hydroelectric potential, and emerging wind energy possibilities offer pathways for diversifying the energy mix over time, though petroleum will remain economically dominant for the foreseeable future.

From Sonangol’s perspective, the $1.75 billion Afreximbank facility, combined with the recent $750 million bond issuance, provides substantial financial resources to execute on the company’s strategic priorities. These include maintaining production from mature offshore fields through enhanced recovery techniques and infrastructure investments, participating in new exploration and development opportunities as they arise, advancing downstream refining and petrochemical projects, and potentially positioning for selective international expansion opportunities.

The facility’s flexible structure, designed to accommodate oil price volatility and operational dynamics, provides Sonangol with the financial adaptability necessary to navigate an inherently uncertain commodity business environment. By securing this substantial multi-year financing arrangement, the company has created a foundation for operational and strategic planning that extends beyond short-term market fluctuations.

For Afreximbank, the successful closure of this transaction reinforces the institution’s positioning as Africa’s leading trade finance provider and demonstrates its capacity to structure and syndicate transactions of significant scale and complexity. As the bank works toward its objective of doubling intra-African trade financing to $40 billion by 2026, deals such as the Sonangol facility showcase the institution’s evolving capabilities and expanding influence in reshaping African economic architecture toward greater self-reliance and continental integration.

The Sonangol financing ultimately represents more than a single corporate credit facility—it exemplifies the broader transformation of African economic engagement, where continental institutions increasingly play catalytic roles in mobilizing capital, structuring transactions, and supporting strategic industries that underpin member states’ economic sovereignty and development trajectories.

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By: Montel Kamau

Serrari Financial Analyst

2nd February, 2026