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Based on the power purchase agreement Ethiopia and
Djibouti signed a year ago, a Djibouti delegation
came to Ethiopia last week to evaluate the power
interconnection progress. A steering ministerial
committee meeting was held in Addis Abeba on
Thursday July ,12, 2007.
It was disclosed in the meeting held at the Hilton
Addis Abeba that a 19.6 million dollar budget is
needed in addition to the 56.1 million dollar loan
obtained from the African Development Fund (ADF).
Alemayehu Tegenu, minister of Mines and Energy,
partook in the meeting with his Djibouti an
counterpart, Mohammed Ali Mohammed, minister of
Energy and Natural Resources.
Mihret Debebe, the Ethiopian Electric Power
Corporation’s (EEPCo) general manager, and Djame Ali
Guelleh, director general of Electricite de Djibouti
(EdD), were also present in the one-day ministerial
committee meeting.
The meeting presented the three month - April to
June 2007 - project implementation report. The two
countries agreed to solicit the Bank for the desired
19.6 million dollars in additional funds.
In terms of ADF’s first loan jointly requested by
the two governments in November 2002, it was not
approved until December 2004. In order to export its
120mw hydroelectric power to Djibouti, Ethiopia has
signed the fist round of a bilateral agreement in
1999 with Djibouti. Ethiopia expects about 80
million dollars from this power export annually.
Djibouti expects 8,600 citizens to get power
connection along the Ethiopian border, while an
additional 36,000 customers will benefit from
reduced tariffs.
Although the two countries in their ministerial
meeting commended ADF’s response on loan approval,
the report presented on the project implementation
read: “The project disbursement is low compared to
plan.” It is expected that, following the signature,
construction of contract disbursement shall be
improved at the end of the year.”
Moreover, with regard to project financing, the
allocated budget in local and foreign currency is
not sufficient to cover the total project cost,
stated the studies.
“Still we have a long way to go until we reach our
final objectives in 2009,” said the minister of
energy and natural resources of Djibouti. “And we
have to continuously strive toward the achievement
of our project.”
The steering committee of the two countries is based
on the financier (ADF) plan and must meet every six
months. The next meeting will be in Djibouti in
December 2007.
Two consultancy firms, PB Power and RSWI, hired by
the countries are engaged in design work currently.
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