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The Black Gold Rush in Ethiopia's Somali region

Nazret.com
Thursday, August 04, 2011

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Ethiopia says it will hope to start gas and oil production in about six years time from its huge and under-developed reserves in its Somali Region. In recent years the government of Ethiopia has issued exploration licenses to several companies to develop 31 blocks out of 41 throughout Ethiopia, according to Reuters news agency.

The Ogaden-basin in Ethiopia's South East is estimated to contain gas reserves of 4.7 trillion cubic feet of gas and major oil deposits. In July, Chinese company Petro Trans has signed a deal to develop Ethiopia's Calub and Hilala gas fields. Reuters says, the company will spend $4 Billion to develop the reserve.

Companies currently engaged in exploration in Ethiopia include, Africa Oil Corporation, Calvalley Petroleum Inc, South West Energy, Pexco Exploration, Tullow Oil, Epsilon Energy Ltd, Falcon Petroleum and Afar Exploration Company.

Security remains a concern in the region, in 2007, ONLF, a rebel group that operates in the region, killed 74 oil workers including nine Chinese, in a brazen attack. The Ethiopian government launched a counter attack, which analysts believe weakened the rebel groups severely. Human rights organizations accuse the government of abuses of the civilian population in the region, but the government denies that.

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