Fitsum Arega, chief of staff in Prime Minister Abiy Ahmed’s office, said on Twitter that Abiy had met with officials from Poly-GCL Petroleum Investment Limited to "officially kick-start crude oil production test in Ogaden Region”.

"The company has discovered that there is a prospect of commercial quantities of crude oil in the region,” Fitsum wrote.

The firm is a joint venture of state-owned China POLY Group Corporation and Hong Kong-based Golden Concord Group.

The state-affiliated Fana media quoted Abiy as saying 450 barrels would be produced on Thursday on a trial basis.

The prime minister added that full scale production of crude oil in the future, would help the state alleviate unemployment and the prevailing foreign currency shortage.

Ethiopia also projects to earn up to 8 billion US dollars annually once it begins exporting natural gas with its full capacity, he said.

A pipeline to export gas to Djibouti, will be launched in September and will take two years to complete.