4. Anadarko Petroleum Corporation and the government of Eritrea signed a USD 23 million oil and natural gas exploration agreement. The agreement gives Houston's Anadarko exploration rights in the area of Edd Block, south of the company's exploration area known as the Zula block. Anadarko obtained exploration rights in the Zula Block following a USD 28 million agreement signed in 1995. Drilling is expected to begin in early 1998.
7. In a meeting held with the public on October 4, the minister of energy and mines, Tesfay Gebreselassie, disclosed that over 1.5 billion Birr (approximately USD 215 million) has been allocated during the past few years to upgrade the country's energy infrastructure. This upgrade includes the construction of a power plant in Hirgigo (near Massawa) (USD 158 million), upgrading the power generation capacity in Beleza, and conducting research to evaluate the country's energy and mineral resources. According to the minister fuel consumption is growing by 10%! annually. Although this indicates growth in economic activities, it is also draining the country's limited foreign currency, said the minister.
(Comment: The increase in the number of vehicles seems to partly account for the growth in fuel consumption.)
8. Minister Tesfay said the cost of running the refinery in Assab was so enornous that it resulted in losses and prompted the GSE to close it. He singled out old machinery and outdated technology as the two major causes for the refinery's inefficiency. He said both Eritrea and Ethiopia decided to import refined oil for the next twelve months. In the meantine, steps will be taken to renovate the refinery within the year.
9. The minister of trade and industry, Ali Said Abdela, held a meeting with the public on September 30 to explain the activities and plans of the ministry. The departments of industry, trade, investment center, and business licensing are working on projects aimed at promoting and developing the export sector. The minister told the charge recently that Eritrea's exports increased from under USD 14 million in 1992 to over USD 71 million in 1996. However, imports were about USD 442.8 million resulting in the country facing a persistent and problemsome trade deficit. The ministry is working to expand Eritrea's export base thereby narrowing the trade gap.