AfDB finances flagship Djibouti geothermal energy project

23 July 2013

NewNet

The African Development Group (AfDB) has provided financing for a new geothermal energy project in Lake Assal, Djibouti. The project has been established as a public-private partnership, according to ESI-Africa, with the country's government overseeing the initial exploration and drilling. The subsequent exploration and project development will then be managed by private partners, it said.

The AfDB group has structured the financing of this project, with the first phase expected to cost around $32m. The AfDB has structured $7.5m in financing, with participation from the Sustainable Energy Fund for Africa (SEFA), a bilateral trust fund anchored with a commitment of $57m by the Government of Denmark.

Other financiers include the Global Environment Facility (GEF), OPEC Fund for International Development (OFID), Agence Française de Développement (AFD) and the Global Geothermal Development Plan (GGDP) through the Energy Sector Management Assistance Program (ESMAP).

In addition, the project received a $5.31m grant from the African Development Fund (ADF), a $400,000m loan from the ADF, and $1.8m from SEFA, alongside an investment from the Djibouti government.

The AfDB is also currently supporting a 20MW geothermal project in Tanzania.

Category: Energy