Ejike Egbuagu of Moneda Invest, one of the speakers at the Namibia Oil and Gas Conference (NOGC) taking place from August 20 to 22, 2024 in Windhoek, the Namabian capital, sheds some light on the forthcoming summit and dynamics of the industry in an interview. According to him, Capital, Capacity and Confidence are critical to a functional oil and gas sector
How do conferences like the NOGC highlight opportunities available in the oil and gas sector
Without traveling, you cannot truly see; and without seeing you cannot truly know… NOGC is a great chance to see golden opportunities in Namibia and learn how to participate and grow.
How valuable are the networking contacts made at such events?
You can never fully predict the outcome of new relationships. Some will be immediately useful, while some may seem otherwise – but I tell you for Africans who are so well connected by culture, yet badly separated by backward immigration policies, ALL new relationships on the continent are important and should be taken seriously.
You’ve worked extensively in finance, international trade and continental deal structuring, what are the best practices around financing opportunities in the oil and gas sector?
Flexibility. In Africa, the race is for the most flexible. I have found that general global best practice in financing often leaves the average African borrower outside the bank. What is the point if African banks grow, and their African borrowers shrink? I am not advocating for weak controls and financial terms – but we must create and support innovative financing systems that meet borrowers where they are, recognising that every borrower will in time grow and evolve.
Drawing on your experience in the Nigerian oil industry – what would you say are some of the main challenges facing the sector in Africa?
Capital, Capacity and Confidence. These three are critical to a functional oil and gas eco system, and Capital absolutely comes first! Africans must have capital to execute even before they have the capacity. You see, banks cannot lend to a borrower without proven capacity and/or collateral – so how then will they lend to Namibian contractors who have no track record in complex oil and gas contracting.
Solving this equation is the mission of the Moneda Invest team across Africa, and through our recent partnership with Ino Harith Capital (a successful Namibian fund manager), we believe a financing solution will soon be available in Namibia that will bring confidence to the government, oil producers, and global markets.
In terms of attracting more FDI into a country, especially in the oil sector, what are some incentives that most appeal to international investors?
I’m not a trade policy expert, but from the perspective of a financier – two things are critical and need immediate attention. One, immigration controls need to be relaxed for technical and specialist talent, especially African talent. This can be done within training and skills sharing programmes managed by NIPDB.
Two, tax incentives for investors in the oil and gas value chain. This goes beyond pipes and drill rigs – I’m talking about people building hotels around oil towns, restaurants and transportation infrastructure etc. Their success creates a conducive environment.
What are the geopolitical considerations regarding Sustainable Financing in the Oil and Gas Sector especially for the African Just Energy Transition lobby?
As long as Africa’s critical projects must be financed by international capital, external political considerations will overwhelm our development and progress, and this goes beyond definitions of sustainability. Controlling our own capital is essential to determining our own destiny – this is why Moneda Invest has launched a dual credit programme in Namibia through (Ino-Harith Capital) and in our general Moneda fund in Mauritius, raising up to $250 million in the first round to support African SMEs playing strong in the natural resource value chains. With the support of African pensions funds, DFIs and other institutional investors, we will deliver world class returns while capitalising African operators to ensure a just energy transition.
