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Ethiopian Electric Power (EEP) has awarded a contract to a Chinese-led consortium to build the 371MW Geba hydroelectric project in the Baro-Akobo Basin, in the east of the country. Engineering, procurement and construction work will be carried out by the China Gezhouba Group Corporation (CGGC), alongside Sinohydro and local firm Sur Construction. EEP’s predecessor, the Ethiopian Electric Power Corporation, originally sought expressions of interest in Q4 2008 to finance and build Geba as two projects, the 220MW Geba I and 165MW Geba II.

Russia’s GPB Ethiopia Resources plans an airborne full tensor gravity (FTG) and magnetic survey over the Gewane el Wiha Block in the Afar licence area. GPB Ethiopia is part of GPB Global Resources Group, which signed a production-sharing agreement for the 42,000km2 Afar licence area in July. The company, a subsidiary of Gazprom, is headed by Boris Ivanov and Christophe Gerard, both familiar faces on the African oil circuit. A tender for the FTG work closed on 3 October. The agreement has a seven-year exploration period and a 25-year production period. GPB Global Resources is the operator of the project and has committed to financing exploration.

Delonex Energy, a new company backed by US investment group Warburg Pincus, has announced its first licence award, taking blocks 18, 19 and 21 in southeast Ethiopia, near the Somali border. Covering 29 865km2 in the Abred-Ferfer region of the Ogaden Basin, the licence is for an initial period of three years, extendable twice for two years. Delonex, run by former Cairn India chief executive Rahul Dhir, won $60m in equity finance from the World Bank’s International Finance Corporation to fund its planned oil and gas exploration in east and central Africa.

Tullow Oil announced on 14 July that the Gardim-1 exploration well, drilled on the eastern flank of the Chew Bahir Basin in the South Omo licence had reached a total depth of 2,468 metres without encountering commercial oil. Tullow said the well intersected lacustrine and volcanic formations similar to those found in the Shimela-1 well on the north-western flank of the basin. Minor intervals with thermogenic gas shows were intersected just above basement. Tullow said seismic interpretation continued on separate prospects elsewhere in the licence that would be targeted by the next phase of the Ethiopia exploration campaign.

The World Bank’s International Finance Corporation (IFC) is participating with up to $150m in a $450m trade finance facility arranged by Natixis to finance the import of refined petroleum products. Under the agreement signed on 15 July, IFC, Natixis, Standard Bank and other lenders will help finance Independent Petroleum Group (IPG)’s import of petroleum products into Ethiopia over one year. The Kuwaiti company maintains a strong relationship with the state Ethiopia Petroleum Supplier Enterprise, as one of the main suppliers of petroleum products to the country for the last four years.

Opposition from local authorities to UK private equity investor Actis’ planned takeover of French operator Veolia Environnement’s electricity, water and sanitation concessions in Morocco may be explained in part by a shift in political and popular opinion away from privately financed projects and concessions back to a greater role for local politicians and the state. Morocco is not alone in this: public/private partnership models that give public bodies, and the politicians who lead them, more control are increasingly in vogue.

The World Bank’s International Development Association (IDA) has approved a loan of $178.5m, alongside a grant of $24.5m from its Scaling-up Renewable Energy Program Trust Fund, to boost development of geothermal resources. The bank said the funding would be administered in two phases, with the first intended to confirm geothermal resources and boost capacity development, and the second aimed at developing the resource for power generation. The project is targeting two geothermal sites, Aluto and Alalobad. At Aluto, four IDA-financed wells will be drilled alongside 22 further wells of between 2,000 and 2,500 metres depth. At Alalobad, four IDA-financed wells will be drilled to explore the site and identify resource potential.

The Shimela-1 well on the South Omo Block has proved another disappointment for operator Tullow Oil, finding only water-bearing reservoirs. Shimela-1 was drilled to a final depth of 1,940 metres to test a prospect in a north-western sub-basin of the Chew Bahir Basin. The Exalo 205 rig will now move to drill the Gardim-1 wildcat exploration well in a separate sub-basin in the south-eastern corner of the Chew Bahir Basin. “Although the Shimela well only found traces of thermogenic gas, it has provided key data to continue to build our understanding of the north-western part of the Chew Bahir Basin,” said Tullow exploration director Angus McCoss.

Moody’s, Standard and Poor’s and Fitch Ratings have all issued sovereign credit rating for Ethiopia, paving the way for the country to debut on international capital markets. Moody’s gave Ethiopia local and foreign currency issuer ratings of B1, with a stable outlook, while the other two agencies rated it B. Prime Minister Hailemariam Desalegn said last year that the country was planning a Eurobond once it had secured a credit rating, which would add it to the growing number of African countries issuing bonds. Last year, African countries including new issuers Gabon and Rwanda issued a record $11bn in sovereign bonds, up from $6bn in 2012.

The Extractive Industries Transparency Initiative (EITI) approved Ethiopia’s application for EITI candidature at a board meeting on 19 March, much to the anger of several parties, including Human Rights Watch (HRW). The country now has three years to achieve compliance with the EITI Standard, which was upgraded last year. “Some opposed this decision, but it should be remembered that becoming a candidate does not mean that any country has met the EITI Standard. In the case of Ethiopia, the decision shows that the Board was convinced by the government’s commitment to the EITI’s principles,” EITI chair Clare Short said in a statement.

Reykjavik Geothermal will begin drilling at the $2bn 500MW Corbetti geothermal power project by July, chief executive Gunnar Örn Gunnarsson told African Energy. The company, which is based in Iceland and owned by US investors, signed an agreement with the government to develop the project in October, and the facility is scheduled to begin operating by 2020. Reykjavik Geothermal expects to begin closing financing worth up to $80m this month, and to raise $500m from equity partners over the course of the project.

The government has approved two farm-out agreements enabling Africa Oil Corporation to bring in Marathon Oil Corporation to the Rift Basin Area and increasing New Age (African Global Energy)’s holding in the Adigala Block. Under the terms of the Marathon farm-out agreement, Marathon will acquire a 50% interest in the Rift Basin Area. Africa Oil will maintain operatorship of the block, but Marathon has the right to take over if a commercial discovery is made. Marathon will pay Africa Oil $3m of past costs, and will fund $15m of its partner’s share of exploration.

Ethiopia and Yemen are preparing to sign a power purchase agreement for Yemen to receive 100MW via a power cable to be laid across the floor of the Red Sea. An Ethiopian government newsletter said the agreement would be signed “soon”, making Yemen the fourth country to buy electricity from Ethiopia via interconnection agreements. Ethiopia has an agreement with Sudan to sell 200MW of electric power, of which 100MW is already under way, while Kenya and Djibouti are receiving 100MW and 50MW respectively.

The Ethiopian government has announced ambitious plans to expand its generation capacity to 37,000MW by 2037 from 2,300MW now, to meet growing domestic demand and supply the region. Ethiopia already exports 60MW to Djibouti and 100MW to Sudan, and is constructing a 500kV interconnection with Kenya, capable of exporting 2,000MW. However, under the new programme, the government aims to export 4,000MW to nine countries in the region, potentially expanding its network of clients to the Southern African Power Pool and countries in North Africa. Aimed at turning Ethiopia into a middle-income country by 2023, the Growth and Transformation Plan seeks to double access rates, increasing the number of Ethiopians connected to the grid to 4m and expanding electricity services to 75% of towns and villages.

Drilling has begun at the site of the Aluto geothermal power plant expansion project phase III. The project to expand the 7MW pilot plant operating on the site will involve drilling 20 deep geothermal wells, installing a heat-gathering system, and building a 70MW power plant and switchyard and a 13km 132kV transmission line from the power plant to Adami Tulu, where a new substation will be built. A feasibility study for generation of power from the Aluto Langano geothermal field was conducted in March 2010 by Ernst and Young ShinNihon LLC, Japan External Trade Organisation and West Japan Engineering Consultants.