Ethiopia’s Ministry of Mines has signed a tripartite agreement with GCL Energy Investment (Ethiopia Branch) and Jurong Group Holdings Co., Ltd. to advance the construction and processing components of the country’s liquefied natural gas (LNG) project.
The agreement marks a new stage in Ethiopia’s efforts to expand natural gas development, following a strategic framework agreement signed by the parties in May 2026. The latest deal is expected to accelerate the second phase of the LNG project and strengthen the development of the country’s natural gas industry.
GCL has been involved in upstream gas development in the Ogaden Basin, located in Ethiopia’s eastern Somali Regional State, where it established the country’s first skid-mounted LNG liquefaction unit at the Calub gas field. Jurong Group brings experience in natural gas liquefaction, storage, transportation and international trade, supported by operations in China’s Xinjiang region and other markets.
Ethiopia’s newly appointed Minister of Mines, Alemtsehay Paulos, called on both companies to use the agreement to accelerate construction of the initial module of Phase II, with the aim of bringing the facility into operation as quickly as possible.
Under the agreement, Jurong Group will contribute its expertise in project management, storage infrastructure and cross-border trade corridors to support the expansion of the Calub gas field project.
Wang Dong, executive president of GCL Group and president of GCL Africa Industrial Group, said the partnership would accelerate engineering and development work toward an integrated natural gas industrial chain covering extraction, processing, transportation and downstream applications.
The project forms part of Ethiopia’s broader ambition to expand domestic energy production, diversify its energy sources and develop industrial uses for natural gas.
However, several key commercial and technical details of the new agreement have not yet been publicly disclosed, including the total contract value, financing arrangements, planned capacity expansion, operating costs and processing fees.
The initiative also complements efforts to promote natural gas as an alternative fuel for transportation and industry. In May 2026, GCL Africa Industrial Group conducted road tests under a project to convert Ethiopian buses from conventional oil-based fuels to natural gas.
The broader programme is expected to support vehicle conversion, the development of compressed natural gas (CNG) and LNG refuelling stations, and the expansion of natural gas distribution for industrial and other domestic uses.
According to information provided by the companies, the first phase of the LNG project is located at the Calub gas field in the Ogaden Basin. Construction began in July 2024, and the facility reportedly entered operation on October 2, 2025.
The first-phase facility was designed to process 200,000 cubic metres of natural gas per day and produce 50,000 tonnes of LNG annually.
The development of subsequent phases is expected to build on this initial infrastructure and expand the role of natural gas in Ethiopia’s energy sector.