Djibouti, Ethiopia, and China have launched a new mega gas project, which comprises a natural gas pipeline, a liquefaction plant, and an export terminal at Damerjog in Djibouti, worth a total investment of approximately $4b, Energy Global reported.

The new 700 km pipeline will transport up to 12bcm/y of natural gas from Ethiopia to Djibouti. The pipeline will enable Ethiopia to use Djibouti terminals to export gas further to China and thus support socio-economic development across the region. The liquefaction plant will have capacity to produce up to 10m tons of LNG per year after completion of the project.

The project, which will be funded by Chinese firm POLY-GCL Petroleum Group Holdings Ltd, . Construction work is expected to start shortly and to be completed by 2019.

The mega gas project will become the second major joint energy infrastructure project to be agreed upon between Djibouti and Ethiopia, All Africa reported.

In September 2015, the two countries had signed a $1.5b agreement to construct a 550km refined petroleum products pipeline linking Djibouti’s ports to the Awash terminal in central Ethiopia. The Black Rhino Group and Mining Oil & Gas Service will construct the pipeline by 2018.