Energy in Eritrea is an industry

Industry

Industry refers to the production of an economic good or service within an economy.-Industrial sectors:There are four key industrial economic sectors: the primary sector, largely raw material extraction industries such as mining and farming; the secondary sector, involving refining, construction,...

 lacking in natural resources, though it has plenty of potential.

Oil and gas

Oil and gas exploration in the Red Sea

Red Sea

The Red Sea is a seawater inlet of the Indian Ocean, lying between Africa and Asia. The connection to the ocean is in the south through the Bab el Mandeb strait and the Gulf of Aden. In the north, there is the Sinai Peninsula, the Gulf of Aqaba, and the Gulf of Suez...

 off Eritrea

Eritrea

Eritrea , officially the State of Eritrea, is a country in the Horn of Africa. Eritrea derives it's name from the Greek word Erethria, meaning 'red land'. The capital is Asmara. It is bordered by Sudan in the west, Ethiopia in the south, and Djibouti in the southeast...

 began in the 1930s. Following independence, the country began awarding production contracts in 1995. However, as of January 2003, Eritrea had no proven reserves of crude oil or natural gas. It also has no known reserves of coal

Coal

Coal is a combustible black or brownish-black sedimentary rock usually occurring in rock strata in layers or veins called coal beds or coal seams. The harder forms, such as anthracite coal, can be regarded as metamorphic rock because of later exposure to elevated temperature and pressure...

. As a result, the country, as of 2001, has had no output of oil, natural gas or coal. Petroleum imports and consumption were estimated each at 4590 oilbbl/d in 2002. In 1997, due to high costs, Eritrea and Ethiopia agreed to shut down their joint operations at the petroleum refinery at Assab

Assab

Assab is a port city in the Southern Red Sea Region of Eritrea on the west coast of the Red Sea. In 1989, it had a population of 39,600. Assab possesses an oil refinery, which was shut down in 1997 for economic reasons...

 and import refined petroleum products. The refinery had a capacity of 18000 oilbbl/d. In 2000 an estimated 3.2 Moilbbl/d of oil were shipped through the Bab el-Mandeb, a narrow waterway between Eritrea, Yemen

Yemen

The Republic of Yemen , commonly known as Yemen , is a country located in the Middle East, occupying the southwestern to southern end of the Arabian Peninsula. It is bordered by Saudi Arabia to the north, the Red Sea to the west, and Oman to the east....

, and Djibouti

Djibouti

Djibouti , officially the Republic of Djibouti , is a country in the Horn of Africa. It is bordered by Eritrea in the north, Ethiopia in the west and south, and Somalia in the southeast. The remainder of the border is formed by the Red Sea and the Gulf of Aden at the east...

 that connects the Gulf of Aden

Gulf of Aden

The Gulf of Aden is located in the Arabian Sea between Yemen, on the south coast of the Arabian Peninsula, and Somalia in the Horn of Africa. In the northwest, it connects with the Red Sea through the Bab-el-Mandeb strait, which is about 20 miles wide....

 with the Red Sea.

Electricity

As of August 2003, about 80% of the population was without electricity, which was available only in the larger cities and towns, although the government was constructing additional electrical distribution lines. In 2002, net electricity generation was 243 GWh, of which 100% came from fossil fuel

Fossil fuel

Fossil fuels are fuels formed by natural processes such as anaerobic decomposition of buried dead organisms. The age of the organisms and their resulting fossil fuels is typically millions of years, and sometimes exceeds 650 million years...

s. In the same year, consumption of electricity totaled 226 GWh. As of August 2003, Eritrea had about 60 MW of diesel-fired generating capacity.