The Arab Energy Fund, which is the new identity for the Arab Petroleum Investments Corporation or APICORP is planning to invest up to $1 billion to drive the energy transition and focus on decarbonisation.

The announcement was made at COP28 at Expo 2020 Dubai, with the multilateral impact financial institution that focuses on the MENA energy sector, planning to deploy the funds across the next five years.

The institution further said it that it will rebalance its overall portfolio with continued loan growth and an enhanced focus on equity investments.

Speaking at the announcement, Khalid Ali Al-Ruwaigh, CEO of the Arab Energy Fund, said: “Our strategy involves diversifying investments by championing technological advancements for enhanced energy efficiencies and driving sustained decarbonisation efforts. Additionally, we are extending our investment scope beyond the core value chain, actively cultivating and shaping value chains within the region.”

Currently, 18% of the institution’s $4.5 billion existing loan portfolio, is dedicated to supporting environmentally and socially responsible initiatives, it said in a statement.

In line with this commitment, the institution introduced several financial solutions, including its $75 million Murabaha facility for voluntary carbon offsets and financing of distributed power portfolios.

(Writing by Bindu Rai, editing by Seban Scaria)