Breaking: Ethiopia terminates contract with Chinese POLY-GCL effective today


Takele Uma

Addis Abeba: Takele Uma, Ethiopia’s Minister of Mines & Petroleum announced the termination of the contract with the Chinese POLY-GCL, which has been engaged in oil exploration in Ethiopia.

In March this year, in a letter of ultimatum sent to Chinese owned POLY-GCL Petroleum Group Holding Limited, the Ministry issued a list of conditions to be met by the company related to its activities in the resource rich Ogaden Basin, in Somali regional state. The Ministry warned the company that failure to comply with the ultimatum will result in the “termination of the PPSAs… without a need for further notice.”

“In accordance with the successive notices the Ministry has issued in the past and in full compliance with the PPSAs and the laws of the land, the termination has now been fully effected,” Takele said. He added that “as long as the financing that would enable to develop the oil and gas fields the Ministry is open for mutual and expeditious settlement.”

POLY-GCL has been exploring petroleum & natural gas in the Ogaden basin since 2013. On June 28, 2018 it officially started crude oil production tests in the Hilala oil fields in the presence of then regional officials and representatives of the federal government. It was hailed as important milestone in the history of the oil & gas development in Ethiopia with Prime Minister Abiy saying that 450 barrels would be produced on a trial basis. However, four years later in June last year, the Ministry issued a warning letter to the company citing its failures to meet the government’s plans.AS


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