Standard Bank’s balancing act: R825 billion oil IPO with Africa’s richest man and a renewables surge

Standard Bank has committed to mobilising R100 billion in green financing by 2028 as renewable energy investment steams ahead. 

This lofty target is coupled with continued backing for oil and gas projects across Africa, with Standard Bank taking a leading role in the planned listing of the Dangote Petroleum Refinery. 

This displays the bank’s tricky balancing act, with it looking to rapidly grow its sustainable financing book while supporting fossil fuel projects in Africa. 

Standard Bank has always maintained that its first commitment is to the development of Africa, with it balancing that need with climate concerns. 

The bank’s data shows that this balancing act may not be needed in the near future, as investment in renewable technologies surges. 

In early June, the bank revealed that its financing for renewable energy generation outpaced that for non-renewable power generation by 8 to 1. 

This shows a clear shift towards renewable energy across Africa as households and businesses look to become self-reliant and gain access to reliable electricity. 

Standard Bank said the growth has been driven by declining energy costs, investor demand, and the need to expand energy access. 

It admits that this is more complex than just financing projects, with the shift to renewables representing a complex balancing act between decarbonisation and economic growth. 

The bank also sees significant opportunities in the sustainable financing space, with it forming part of greater infrastructure spend, which it sees as a key driver of earnings in the future. 

By the end of 2025, Standard Bank had mobilised 62% of its planned R450 billion sustainable financing target, financing R47.1 billion in projects over the past year. 

In the next two years, the bank aims to mobilise a further R100 billion, with a significant chunk of this mobilised in South Africa. 

The bank is the lead arranger for 506 MW of solar power at the Khauta South and West projects in the Free State and is a key financier of Seriti’s 465 MW wind portfolio in Mpumalanga. 

The $50 billion IPO 

Standard Bank’s sustainable investment drive is being coupled with its leading a blockbuster IPO for an oil refinery across multiple African exchanges. 

The listing of the Dangote Petroleum Refinery, valued at $50 billion (R825 billion), will put liquidity on exchanges across the continent to the test. 

As Africa’s largest lender by assets, Standard Bank is leading this process, with its Nigerian unit being the lead adviser for the IPO. 

Its Corporate and Investment Banking crown jewel will play the leading role in advising on the IPO’s structuring, execution, and marketing. 

The IPO is evidently important for the bank, as well as its broader relationship with Dangote Industries, which is led by Africa’s richest man, Aliko Dangote. 

Standard Bank CEO Sim Tshabalala recently travelled to Nigeria to tour Dangote’s refinery along with an army of senior executives. 

“We are here because the Dangote Group is a large and important global player and a significant force on the African continent,” Tshabalala said on the tour. 

“As the group continues to expand in Nigeria and across Africa, there will be opportunities for financial advisory services and balance sheet support, and we stand ready to provide both.”

The refinery itself is a feat of engineering, with its importance rising amid the conflict in the Middle East as an alternative supplier of refined petroleum products. 

South Africa has notably worked hard to secure long-term supply contracts from the facility to reduce its reliance on the Middle East. 

“This is a wonder to behold. It is massive, productive and transformative. It is already making a significant contribution to Nigeria’s economy through its impact on foreign reserves, the balance of payments and the lives of ordinary Nigerians,” Tshabalala said. 

The refinery has a maximum capacity of 700,000 barrels per day, and it consistently runs at 650,000 barrels per day. 

Dangote plans to build another refinery on the other side of Africa, most likely in Kenya, to further reduce the continent’s reliance on imported petroleum products.