Ethiopia, Djibouti and South Sudan infrastructure cooperation

[Roha]

Djibouti believes in Ethiopia’s growth


Wednesday, 14 December 2011 00:19


Djibouti is planning to invest over USD 1.5 billion in the next three years on ports and maritime related business activities, keeping Ethiopia in mind.

The Djibouti Ports and Free Zones Authority chairman, Aboubaker Omer Hadi, disclosed the intent of his agency last Friday at a reception held with clients and business partners at the Sheraton Addis.

Aboubaker said the major investment is going to be on a new ship repair and dry dock infrastructure that is going to cost 400 million dollars, while the second phase of the Doraleh Container Terminal will be constructed with an outlay of 330 million dollars with a capacity of three million TEU’s.

“The current Doraleh Container Terminal traffic is expected to reach its full capacity of handling 1.2 million TEU’s by the end of 2012 and we need to increase our capacity by constructing another terminal to handle the increasing traffic,” Aboubaker added. Djibouti Port handles over 90 percent of Ethiopia’s rapidly growing import

The 150 million dollar construction of the second phase of the Oil Terminal is also expected to start in 2012 aiming to increase the current capacity by 30 percent.

According to the chairman, the port’s activity of non-containerized traffic in 2011 increased by 60 percent reaching 4.5 million metric tons. In relation to containerized cargo service, traffic doubled to reach 800 thousand TEU compared to last year’s same time activity.

The petroleum traffic to Ethiopia also surged to 2.3 million cubic meters on average in 2010 and 2011. “This is a development supported by additional capacity created following the inauguration of the first phase of Doraleh Container Terminal,” Aboubaker said.

In addition the Djiboutian authorities are also set to expand the Port of Djibouti’s outer jetty berths and increase its depths from 12 to 13.75 meters with a total investment of 88.5 million dollars. This will provide the port with a capacity to accommodate six million tons of cargo a year in its first phase and three million extra tons in its second phase.

The authority also aspires to develop Tadjourah port at a cost of 85 million dollars. The port located 15 Km from Tadjourah and expected to be completed by 2013 will be mainly for bulk commodities like potash, explained Aboubaker.

Construction of the Port of Goubet will also consume an investment of 55 million dollars and is expected to be operational in 2013. It is a port primarily intended for the export of salt and will have the capacity of handling 4.5 million tons of traffic per year.

The authority has also a plan to set up a livestock port inside the existing Djibouti port at a cost of 20 million dollars with a capacity to serve two million heads of livestock annually. It also plans to develop a Free Zone, the Jaban Us, in PK12 at a cost of 30 million dollars, and expects to launch its study in 2012.

The coming three years will now be dedicated to the development of the Ports and Free Zones with a total outlay of 1.5 billion dollars, announced Aboubaker Omar Hadi, the newly appointed head of Djibouti Ports and Free Zones Authority.

Aboubaker, a man in his fifties who previously worked at the Port of Lagos in Nigeria, succeeded Aden Ahmed Doualeh in July 2011. With a rich career in the field of transport and port affairs, particularly with many qualities such as leadership and flexibility, he is considered the right person to take the authority to a higher level. Aboubaker has had a thirty-year career in the port of Djibouti, where he made his debut in the early 80’s.

In his speech Aboubaker noted that his office is in discussion with the ministries of transport and customs authority of South Sudan, Ethiopia and Djibouti so as to finalize the transit agreement and pave the way for South Sudan cargo to transit through Ethiopia and use the port of Djibouti as its first port. He explained the road has been completed on the Ethiopian side and is well in progress in South Sudan. But, he said, for the short and medium term the options will be the waterways from Malakal to Juba and Wau using multimodal roads and barges.

The Djibouti Ports & Free Zones Authority is the governing authority that sets the rules, directives and overarching principles for the smooth and efficient running of the current and future ports; as well as free zones, in Djibouti.

As of July 1, 2011 the management contract between DP World and the Djibouti Ports & Free Zones Authority come to an end, and the general cargo has since been handled by the authority. In June 2000, the government of Djibouti and DPWorld signed a 20 year contract to manage the Port of Djibouti facilities which were later extended. During that period of cooperation, the plan to construct a new port emerged in November 2006, and the cooperation evolved into a venture on Doraleh Port also to be managed by DPWorld. The Doraleh Port includes a container and an oil terminal which was a 450 million dollar venture where the government of Djibouti gets two third and DPWorld one third of the revenue from the port.


http://capitalethiopia.com/index.php...ital&Itemid=27

This might be a big income generator for Ethiopia if it happens. What do you think?

[yosef]

Interesting. I know that Kenya and Djibouti may end up competing fiercely to garner South Sudan's business, in the end I think S.Sudan will use both ports (Djib. & Mombassa/Lamu) and even Port Sudan to some extent for its imports and exports. Although the oil transport question remains largely unresolved...


Anyway, here is some more news from Djibouti, looks like they are looking to grow fast:

Djibouti Aspires to Build Largest Ship Maintenance Yard for Region

• New ports and free zones chairman sees outlay of 1.54 billion dollars in five major projects

The administration of Ismael Omar Guelleh in Djibouti has plans to build what will be the largest ship maintenance yard for East Africa and on the Red Sea corridor at a projected cost of 400 million dollars. Yet, experts in charge of developing the project have to choose the site for the project between the north coast of Djibouti (around Tajourah) and the country’s south coast, around Damerjog.

Water depth, wind level and geographical protection are factors in determining where the shipyard will be erected, according to Aboubaker Omar Hadi, chairman of the Djibouti Ports & Free Zones Authority. “Otherwise, you will have to build a very expensive facility for a water break,” he told Fortune.

With the desire to incorporate dry dock and lift system models, the ship maintenance yard will be the ninth on the continent and the second on the East African coast, next to the 70-year old African Marine & General Engineering Co Ltd of Kenya. However, Djibouti’s shipyard will have the capacity to repair ships with 50,000dwt (dead weight), while its contender in Mombassa handles only up to 12,000dwt.

read the rest @ AddisFortune

[Xusein]

A major infrastructure effort is required first. But I think it would be amazing if this was a reality.

[Yoniii]

Originally Posted by Roha

This might be a big income generator for Ethiopia if it happens. What do you think?

My first thought was pollution, last thing we need are more outdated trucks on our roads. I guess these recent "green talks" have made an impact on me lol.

I really really really hope it happens. If South Sudan gets used to the idea of Ethio-Djibouti being the main import/export corridor, there will be an economical reason to expand the (future) railway from Jimma to Juba. I believe that we will see a big income generator once such a railway is in place.

[abesha]

This is why the railroad to Gambella needs to be completed ASAP. There will be direct rail transport from Gambella to Djibouti, so South Sudan only has to either build a rail line to Gambella, or use transport trucks to up to Gambella, then put it on the freight train.
We can get a huge chunk of the business with little of the pollution.

[Yoniii]

Juba is located in the most southern tip of the country. If I'm not totally lost, I believe it's geographically closer extend a railway line from Jimma. Either way, I would love to see a cross-country line between Gambella and Dire.

[abesha]

Hm, you're right. I just checked the map of the railroad and there's no line to Gambella

The first phase has a line until Bedele (by way of Jimma). The furthest it'll go in the second phase is Soma. So you're right, from Jimma to Juba seems likely.

Here's the map of phase one:

[Ahadu]

[abnet]

Originally Posted by Yoniii

My first thought was pollution, last thing we need are more outdated trucks on our roads. I guess these recent "green talks" have made an impact on me lol.

I really really really hope it happens. If South Sudan gets used to the idea of Ethio-Djibouti being the main import/export corridor, there will be an economical reason to expand the (future) railway from Jimma to Juba. I believe that we will see a big income generator once such a railway is in place.

I was doing the straight line measurment on Google Earth and what I got are
From Juba to Djibouti port its about 1460 kms.
From Juba to Mombasa Kenya (since the Lamu project is still a talk) its 1280 kms.
From Juba to Port Sudan its 1620 kms.
So if Ethiopia can push for business to happen it will be a win-win situation for the three countries (Ethiopia,South Sudan and Djibouti) .And the Mombasa port is already handling more than its capacity and congested I don't think its going to be ideal port for the South Sudanese.
About pollution ,in Ethiopia we don't have that much polluting industries ,we don't have coal fired power plant(which is the biggest polluters in the US and China) only our polluters are these old trucks .For this we can invite Ethiopian companies which has newer fleets and handle the freights.This will benefit a lot of truck drivers with their helpers and the cities and towns which the trucks pass will get some business on the process.

[African Lion]

Good news either way. Djibouti is doing a great job and we should let them have that comparative advantage and focus on other things.

South sudan needs two options, for leverage.

[Ras Siyan]

Excellent news! Thanks for posting. These are very ambitious projects, I really hope they materialize, it would propel the Djiboutian economy and strengthen our position of regional hub. Our strategic location is our most precious natural resource, we must make full use of it.

Originally Posted by Ahadu

Did work on the Jimma line start? A line from there to Juba would make more sense as it would be closer. And Djibouti-Ethiopia could grasp that South Sudanese market from the EAC countries. Let's hope our countries work together to make this happen and both benefit from it.

[abesha]

Hi Ras Siyan.

No the Jimma line hasn't started yet, but if you look at the map I posted on this same page, you'll see it's part of phase 1. So they'll launch it soon and it should be completed by mid-2015!

So far Awash-Djibouti (center of country towards the east) and Awash-Mekelle (center to north) are launched. The second line to Djibouti and the Western line are next.

[Ras Siyan]

Good to have you back frangine

So if I understand, both lines to Djibouti and all the way to Jimma will be completed by 205. That's good news.

And this is a completely new line right? Different from the obsolete Addis-Djibouti line. But why not start Awash-Addis before Mekelle? So that goods can freely flow from Djibouti to Addis?

[Roha]

Shell plans oil pipeline construction from South Sudan to Ethiopia .

Saturday, 31 December 2011 07:32 By KALEYESUS BEKELE Hits: 416 .


The Royal Dutch Shell is planning to construct an oil pipeline line all the way from South Sudan to Ethiopia. Reliable sources told The Reporter that a business delegation from Shell visited South Sudan in November. The delegation that met senior South Sudan government officials expressed Shell’s interest in acquiring an oil exploration area in south Sudan and construct an oil pipeline that can haul crude oil from South Sudan oilfields to Ethiopia’s Gambella region.

After declaring independence in July 2011, South Sudan broke away with 75 percent of Sudan’s oil reserve. Oil started being produced in Sudan in the 1990s and has become the mainstay of the economies of the north and south. Most, but not all, of the oilfields are in South Sudan, but the export pipelines, Red Sea export terminal, and refineries, are in the north. Agreement to share control over oil resources and revenues was a central part of the 2005 Comprehensive Peace Agreement, but up to the eve of South Sudan’s secession, north and south had not resolved how to divide the industry or its revenues.

Referendums are indeed costly. Sudan has lost its oil reserves while its neighbour, Ethiopia, had lost its two ports and refinery in Eritrea. Landlocked Ethiopia has been importing refined petroleum products since 1998. Currently, the Ethiopian Petroleum Enterprise is undertaking a feasibility study on building a new refinery near the Ethio-Djibouti border.

Sources said Shell’s plan is to acquire an oilfield in South Sudan and build an oil pipeline stretching from South Sudan to Ethiopia, adding that Chinese firms could be involved in the project. If South Sudan accepts the proposal, the executives of Shell will present the idea to the Ethiopian government. “The Ethiopian government may consider building a refinery in the Gambella Regional State,” a senior government official told The Reporter.

David Kong, deputy head of mission at teh embassy of South Sudan in Addis Ababa, said he was not aware of Shell’s proposal.

http://www.thereporterethiopia.com/N...-ethiopia.html

[Yoniii]

Interesting stuff, this mean that we can cut of the middle man and get cheap oil without paying for port access.

[valeria12]

Really very nice stuff! I like it and hope from you to continue it in future also.

[abnet]

PetroTrans negotiates with South Sudan on pipeline construction via Ethiopia.

Saturday, 28 January 2012 07:17
By KALEYESUS BEKELE


The Hong Kong based Chinese company, PetroTrans, is negotiating with the Government of South Sudan on the construction of an oil pipeline from South Sudan oilfields to the Port of Djibouti. Reliable sources told The Reporter that PetroTrans has submitted a proposal to the South Sudanese government on the pipeline construction that stretches from Gambella to Djibouti. The Chinese company is expected to come up with a loan from the Chinese state banks. However, the distance and cost of the pipeline construction is not yet determined. The project needs the approval of the Ethiopian government. The pipeline will enable South Sudan to have an alternative pipeline to export its crude oil to the international market.

Last week South Sudan government officials announced that they would halt oil production within two weeks. South Sudan accused the north of stealing its oil export. Sudan says the south owes it more than 750 million dollars transit fees, adding that it would not keep on exporting the South’s oil unless agreement is reached on payment of arrears.

In Juba, an official last week said that South Sudan will continue to look for an alternative pipeline to export its oil. “We do not see a future in the oil infrastructure of the north. Our oil must have access to international markets. We should not be punished because we decided to secede," Stephen Dhieu Dau, the South Sudanese oil minister told Reuters.

According to South Sudanese government officials, the new country is considering two alternative routes to construct alternative pipelines to the port of Djibouti via Ethiopia and to the Kenyan port of Lamu through southern Ethiopia.

PetroTrans which is negotiating with South Sudan is the company that took over all the oil exploration concessions held by the Malaysian company, Petronas, in Ethiopia in the Ogaden basin. PteroTrans signed an agreement with the Ethiopian Ministry of Mines that would enable it to develop the Calub and Hilala gas fields in the Ogaden basin. Petro Trans has good reputations in Sudan, Chad and Nigeria. Petro Trans Company Ltd. Was established in 1997, founded by a Chinese investor, John Chin. Petro Trans has been mainly involved in the oil and gas development industry, as well as oil and gas financing and leasing.

http://www.thereporterethiopia.com/N...-ethiopia.html

[Ras Siyan]

Interesting news

PetroTrans, is negotiating with the Government of South Sudan on the construction of an oil pipeline from South Sudan oilfields to the Port of Djibouti. Reliable sources told The Reporter that PetroTrans has submitted a proposal to the South Sudanese government on the pipeline construction that stretches from Gambella to Djibouti.

The pipeline goes from South Sudan oild fields or from Gambela?

[yosef]

Addis Ababa, February 3, 2012 (Addis Ababa) - Ethiopia, Djibouti and South Sudan here on Thursday signed a tripartite Memorandum of Understanding (MoU) that would help them enhance cooperation and partnership in infrastructure development.

According to the MoU, the main areas of cooperation will be in the development of energy and fiber optics. The three countries will sign other agreements on specific projects to be implemented in the future.

Ethiopian Finance and Economic Development Minister, Sufian Ahmed, Djiboutian Finance Minister, Ilyas Moosa Robleh and South Sudan Petroleum and Mining Minister, Stephen Dhieu Dau signed the MoU.

Sufian said on the occasion that the MoU will enable the two countries to cooperate in the construction of roads and railways as well as installation of electricity and telecommunication lines.

Govt. News Agency

Video: http://www.ethiotube.net/video/17718...Infrastructure

[Ras Siyan]

Great news! Hope more details come out...Djibouti should definitely benefit from the current rift between North and South Sudan to market the use of it's ports to South Sudan.