28 August 2013: The African Development Bank (AfDB) and the Government of Djibouti have signed agreements for US$7.5 million in funding for a geothermal energy exploration project in the Lake Assal Region that is expected to catalyze further private investments in the sector.

The Lake Assal project will aid in geothermal expansion and eventually help reduce Djibouti’s dependence on fossil fuels for electricity generation. The AfDB notes that East Africa has seen a surge in investments in geothermal over past two years as interest has picked up in the technology and also because of the availability of development financing from institutions such as AfDB, which provides concessional finance at early and high-risk stages related to exploration and drilling. [Press release]