Djibouti signs $4bn gas project deal with China’s

Djibouti has signed a preliminary deal for a $4bn gas project with Chinese firm POLY-GCL Petroleum Group Holdings Ltd.

The Horn of Africa nation has signed a memorandum of understanding with the Chinese company for a large-scale energy project to be constructed in Damerjog, close to the country’s border with Somalia.

Djibouti sign $4bn The project includes a natural gas pipeline, a liquefication plant and an export terminal to be located in the eastern village. The gas pipeline will transport 12 billion cubic metres of natural gas from Ethiopia to Djibouti per year. the liquefication plant will start with a target of producing 3 million tonnes of liquefied gas per year, starting from 2020, but this target will eventually rise to 10 million tonnes.

POLY-GCL has already finished drilling appraisal wells for gas deposits in southwest Ethiopia – a project linked to the export terminal plans in Djibouti.

Djibouti’s energy minister Yonis Ali Guedi says further negotiations over concession agreements for the project will happen within the next six months with construction scheduled to start next year.