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DJIBOUTI, 4 November 2026 China's PetroChina International is exploring plans for a 1,550-kilometre oil pipeline connecting South Sudan to Djibouti's Red Sea ports through Ethiopia, potentially providing the landlocked country with an alternative route for exporting crude oil.
According to Ethiopian business newspaper Capital Ethiopia, the proposal aims to diversify South Sudan's access to international oil markets while expanding Djibouti's petroleum storage and transport infrastructure.
The project was discussed during a meeting between the chairman of the Djibouti Ports and Free Zones Authority and a senior delegation from PetroChina International (Middle East), led by the company's Deputy General Manager, Hu Weiqiang.
The talks, held at the Red Sea World Centre on Tuesday, focused on developing a petroleum storage facility with a capacity of 300,000 cubic metres in Djibouti's Damerjog industrial zone.
Both sides also discussed the possibility of constructing an oil refinery and developing a transport corridor linking the three countries.
The proposed pipeline would originate in South Sudan, cross Ethiopia and terminate in Djibouti, passing through terrain reaching elevations of up to 2,400 metres.
Djibouti was identified as the proposed endpoint because of its existing port facilities and supporting infrastructure, including roads and electricity services.
Under the proposal, the Damerjog liquid bulk port would serve as a major export terminal for South Sudanese crude oil destined for international markets.
If implemented, the pipeline could reduce South Sudan's longstanding dependence on export infrastructure running through Sudan to Port Sudan on the Red Sea.
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The conflict in Sudan has repeatedly disrupted South Sudan's oil transportation, affecting an economy that relies heavily on petroleum exports for government revenue.
The idea of an oil pipeline linking South Sudan to Djibouti is not new. Following South Sudan's independence in 2011, the two countries signed a memorandum of understanding on developing a pipeline through Ethiopia, but implementation has made limited progress.
For Djibouti, the proposed corridor could support broader efforts to expand its petroleum storage, refining and export capabilities.
The Damerjog industrial zone has already attracted investment in a separate petroleum storage facility with a planned capacity of 375,000 cubic metres, being developed by Dangote Industries.
That facility forms part of a $660 million petroleum pipeline project connecting Damerjog with Dewele in eastern Ethiopia, intended to reduce fuel transportation times between the two countries.
PetroChina International (Middle East), established in 2002, operates under PetroChina, which is part of China National Petroleum Corporation (CNPC).
CNPC has longstanding investments in South Sudan's oil industry, including involvement in Dar Petroleum Operating Company, which operates oil-producing Blocks 3 and 7.
The latest discussions remain at the exploratory and investment assessment stage. No final agreement, estimated construction cost or timetable for the proposed 1,550-kilometre pipeline has been announced.