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Djibouti establishes national geothermal service company

Djibouti establishes company to work on developing geothermal resources, to build up capacity in drilling, training and capacity building as well as water well drilling.

With an installed power generation capacity of currently 126 MW, the country of Djibouti is depending largely on imported coal to operate its power plants. So efforts to explore geothermal energy and other sources of energy target the reduction of cost of electricity and with an estimated potential of 1,000 MW, the opportunity is real.

Now several news outlets report on a presidential decree of February this year, that the country has taken a step forward in its project to exploit its geothermal resources with the establishment of its national company dedicated to renewable energy sources. The main mission of the Red Sea Drilling Company (RSDC) will be the development of the country’s geothermal resources. It will also carry out activities devoted to training and local capacity building in order to have a qualified workforce within a few years.

At the second stakeholder meeting of the African Geothermal Center of Excellence in 2017 a company presentation provided details on the company, so we are not 100% certain exactly when the company was announced. But it seems to be a majority Djibouti-owned company with Turkish partners.

The RSDC will eventually acquire the capacity to drill thermal and hydrocarbon wells. Pending the operationalization of this national entity, the country is subcontracting certain aspects of its geothermal projects with its neighbor, Kenya. In February 2021, it awarded a $ 6.5 million contract to KenGen, the Kenyan power generation company for the drilling of three geothermal wells in the Lake Assal region.

The company will not solely focus on geothermal work, but also plans on providing training and capacity building that should see it produce a number of engineers and technicians in the coming years and drill for water. The company has plans to grow beyond Djibouti and also serve markets in Ethiopia, Somalia and Kenya.

Djibouti has a geothermal potential estimated at 1,000 MW, enough to meet the country’s electricity demand, of which 50% of the population does not yet have access to electricity. The country has been working on projects mostly in the Lake Assal region, drilling for the Assal-Fiale geothermal project and has recently tendered drilling for the Assal-Galla-Le-Koma project to KenGen.

Currently, the only national geothermal project under development will allow it to initially have 20 MW of electricity, then 50 MW in the long term.

Source: Agence Ecofin

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