Dangote Ethiopia fertiliser deal sees $4.2bn gas agreement with GCL to power a major plant, boosting food security and industrial growth in East Africa

Dangote Industries Limited has signed a landmark $4.2 billion, 25-year natural gas supply agreement with GCL Group to power a major fertiliser project in Ethiopia, in a move set to redefine industrial collaboration between Africa and China.

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The agreement, signed in Lagos, will supply natural gas to Dangote Group’s planned three-million-tonne-per-year urea complex in Gode, located in Ethiopia’s Somali Region.

The development marks a significant milestone in the Dangote Ethiopia fertiliser deal, one of the largest industrial partnerships on the continent.

The fertiliser plant, valued at $2.5 billion, is being developed under a 60:40 equity structure between Dangote Group and Ethiopian Investment Holdings, and is expected to commence operations in 2029.

Once operational, the facility is projected to become East Africa’s largest modern fertiliser hub, meeting Ethiopia’s domestic urea demand while supplying neighbouring markets, thereby reducing dependence on imports and strengthening regional food security.

Natural gas for the project will be sourced from the Calub Gas Field in Ethiopia’s Ogaden Basin and transported via a dedicated 108-kilometre pipeline directly to the plant, forming a fully integrated energy-to-agriculture value chain.

President and Chief Executive Officer of Dangote Industries Limited, Aliko Dangote, said the initiative represents a decisive shift toward industrial self-reliance in Africa.

“Africa’s energy industry cannot continue indefinitely exporting raw materials while importing finished products,” Aliko Dangote said, adding that the partnership would create a seamless “gas-to-fertiliser” value chain to enhance food security and economic autonomy.

Chairman of GCL Group, Zhu Gongshan, described the collaboration as a strategic evolution in China–Africa relations, noting that it would expand opportunities in Ethiopia’s energy, chemical and agricultural sectors.

Zhu Gongshan highlighted the role of the Ethiopian government in facilitating the project, adding that the partnership would combine GCL’s oil and gas expertise with Dangote Group’s industrial footprint across Africa to boost market reach and operational efficiency.

Industry analysts say the project carries transformative potential, including enabling fertiliser self-sufficiency in Ethiopia, stimulating industrialisation in the Somali Region and creating thousands of jobs.

The initiative also aligns with global green development trends, as fertiliser production using natural gas feedstock is considered a lower-carbon alternative compared to other methods.

By integrating upstream gas extraction, midstream transportation and downstream fertiliser production, the project establishes a closed-loop industrial chain that leverages both Chinese technology and Africa’s natural resources.

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The Dangote Ethiopia fertiliser deal is widely viewed as a flagship example of Belt and Road cooperation, signalling a new phase of large-scale, resource-driven industrial partnerships aimed at driving sustainable growth across the continent.