France allocates $21 million to complete drilling activities in Ethiopia

France under its inclusive public development bank French Development Agency (FDA) has approved $9.4 million funding for Ethiopia’s Tendaho geothermal project to enable the East African country complete drilling activities planned as part of the geothermal exploration. The funding will be in two phases, with each phase having its own needs catered for by the financial inclusion. The grant agreement between both countries is for a total of $21 million for the two phases.

The signing ceremony of the grants Agreements was done by Admasu Nebebe, Ethiopian State Minister of Finance and Economic Cooperation, Frederic Bontems, Ambassador of France to Ethiopia and Ignace Monkam-Daverat, the French Agency for Development (AFD) Regional Manager in Addis Ababa.

For the first phase, $12 million grant will be provided by AFD in contribution Urban Institutional and Infrastructure Development Program (UIIDP), that was started by the World Bank earlier this year. The program is under World Bank’s Ethiopia Country Partnership Framework.

The second phase which is worth $9.4 million, will focus on the Tendaho geothermal exploration project supported by European Union through the European Union Africa Infrastructure Trust Fund (EU-AITF).

This investment grant allocated for the Tendaho geothermal exploration project constitutes an additional funding of a previous $11 million concessional loan from AFD and a total of EUR 7.5 million from previous EU-AITF grants. The financing will help to complete the drilling activities planned as part of the geothermal exploration and development effort in the Afar region.

The second project is implemented by Ethiopian Electric Power (EEP), in coordination with Geological Survey of Ethiopia (GSE).

In assistance to projects, the development policy of the European Union aims at supporting Ethiopia’s economic growth by developing geothermal energy, a source that is reliable and low carbon and will help to improve the capacity for climate change adaptation. The activities will focus on developing a shallow reservoir in Tendaho to allow a sustainable exploitation with a capacity of an estimated 10MW, and on exploiting a deep reservoir by drilling wells at great depth.