NAIROBI, Kenya, May 12 – Djibouti has commenced construction of the Sh20.7 billion ($160 million) Fuelstor Terminal, a landmark energy and logistics project expected to strengthen regional trade connectivity and bolster energy supply resilience across East Africa.
The groundbreaking ceremony drew senior government officials, industry leaders, and international partners, marking the start of a project seen as a major addition to the Horn of Africa’s strategic infrastructure network.
Located in the strategic Damerjog corridor, the Fuelstor Terminal is being developed as an integrated logistics and trading platform designed to facilitate the storage, redistribution, and movement of fuel, liquefied petroleum gas (LPG), edible oil, and other essential commodities.
Backed by Salaam Group, the project represents an investment of approximately DJF 30 billion and is being developed on nearly 22 hectares of land. Once completed, the terminal is expected to have a storage capacity of about 400,000 metric tons, positioning Djibouti as a critical hub within regional and global supply chains.
Officials said the facility will support growing regional demand while enhancing the efficiency of trade flows to Ethiopia and the wider East African market through multimodal transport connectivity.
“This project represents a defining milestone for Fuelstor and a significant step forward for the region’s energy and logistics landscape,” said Fuelstor General Manager Houssein Ahmed Houmed.
“Fuelstor Terminal is uniquely positioned to become a key gateway connecting global supply markets to growing demand across East Africa.”
The project comes at a time when governments and businesses are increasingly prioritizing supply chain diversification and energy security amid shifting global trade routes and geopolitical uncertainties.
The terminal is also expected to reinforce Djibouti’s role as a strategic trade corridor linking Africa to international markets, while supporting the country’s long-term ambition of becoming a regional logistics and maritime hub.
Construction works are being undertaken by Somagec, an international engineering group known for large-scale industrial and maritime infrastructure projects.
Project developers say the partnership combines Fuelstor’s long-term infrastructure vision with Somagec’s engineering expertise to deliver a modern and reliable logistics platform.
Beyond its strategic importance, the project is expected to generate significant economic activity during both construction and operational phases, including the creation of hundreds of jobs and the development of local technical capacity.
Fuelstor said the terminal is designed as a multi-product platform integrating storage, logistics, and trading capabilities to improve supply chain efficiency and support the modernization of East Africa’s logistics ecosystem.
The company focuses on the development of large-scale infrastructure platforms for fuel, LPG, and edible oil storage and distribution, with the aim of strengthening regional trade and energy networks across Africa.
