The Ethiopian government has announced today the establishment of Petroleum Development Enterprise, reports Bloomberg. The announcement was made by Minister Sinknesh Ejigu who said that the establishment help increase oil and gas resources in partnership with private companies has unsettled the Ogaden region.

The company will “bolster and enhance development,” the minister said.

“A similar public enterprise will be set up to extract mineral resources including precious metals, tantalum and potash,” she said.

The announcement comes after the government in July ended five production-sharing deals with PetroTrans after it cited a lack of progress being made by the Hong Kong-based enterprise.

Sinknesh reportedly said last month that the government “may develop gas fields in the country’s eastern Somali region after cancelling its contract with PetroTrans,” which Bloomberg reported “it had expected to bring financing of as much as $5 billion. The company rejected the termination of its contract.”

The production-sharing accords were for 10 blocks in the Ogaden area of the Somali region, which include the Calub and Hilala fields with natural gas resources estimated at 4 trillion cubic feet. SouthWest Energy, an Addis Ababa-based company, has said it hopes to strike oil in the Ogaden next year.