Press Release

OPEC Fund extends €16.87 million loan to Tunisia for energy project

21/2006 March 21, Vienna, Austria
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The OPEC Fund for International Development today signed a €16.87 million loan agreement with the Republic of Tunisia to construct a natural gas pipeline in the southeastern part of the country. Once complete, the project will help boost the socio-economic development in the region and provide a reliable, cheaper source of energy.

Tunisia’s oil resources have declined over the years, necessitating the import of expensive refined products, particularly liquefied petroleum gas (LPG), which is heavily utilized for both commercial and residential purposes. LPG is not only costly, however, but also requires special handling and storage, and can be potentially hazardous to transport. As part of its national energy strategy, government has accorded high priority to switching from an LPG distribution system to a less polluting, safer one driven by natural gas, which is one of Tunisia’s natural resources.

The project will install a total of 211 km of on- and off-shore gas pipeline in the southeastern part of the country. The pipeline will pass through the industrial city of Gabes (enabling a number of the local industries to connect to the network) and continue southeast to Zarzis city, and subsequently loop back to Jerba Island. It is anticipated that the network will have the capacity to deliver 300 million m³ of fuel per year. As Zarzis city and Jerba Island are frequent tourist destinations, the initiative will have a positive impact on the local economies as the new pipeline will supply natural gas to the area’s 133 hotels and be able to accommodate the area’s projected expansion. In addition, residential connections will be made available in Zarzis and Jerba.

The OPEC Fund has extended seven loans to Tunisia, which co-financed public sector projects in the agriculture, education, national development banks and transportation sectors. The country has also been the recipient of several grants. Additionally, the Fund has approved three private sector operations in Tunisia.

Today’s agreement was signed in Vienna by HE Professor Mohamed Daouas, Ambassador of the Republic of Tunisia to Austria, and by HE Mr. Jamal Nasser Lootah, Chairman of the Governing Board of the OPEC Fund.