Ethiopia and Djibouti had inked a deal worth USD 1.55 billion for fuel pipeline with Mining, Oil & Gas Services and Blackstone Group LP-backed Black Rhino Group, Bloomberg reported.

According to the companies, the agreement was signed on Tuesday, September 29, 2015, for the construction of 550 kilometer (340 mile) line to transport diesel, gasoline and jet fuel from the Djibouti port to central Ethiopia.

The companies are expected to complete the construction of the pipeline in the coming two years.

"The pipeline will increase energy security, aid economic development and reduce harmful emissions,” Brian Herlihy, Black Rhino chief Executive Officer, stated.

The project is named Horn of Africa Pipeline. It embraces an import facility with 950,000 barrels of storage capacity in Damerjog, Djibouti, joined to a storage terminal in Awash, Ethiopia. The pipeline is 20 inch (51 centimeter) wide and able to transport 240,000 barrels of fuel per day.

Source: Bloomberg