Dangote Secures $4.2B Gas Deal with China’s GCL to Power Ethiopia Fertiliser Megaproject
Dangote Industries Limited (DIL) has finalized a landmark $4.2 billion, 25-year natural gas supply agreement with China’s GCL Group to power its massive fertiliser expansion in Ethiopia. The deal, signed in Lagos, is one of the most significant China–Africa industrial partnerships to date, underscoring a shared vision for sustainable energy-driven development on the continent.
The gas supply will support Dangote’s upcoming 3‑million‑tonne-per-year urea fertilizer complex in Gode, Somali Region. Valued at $2.5 billion, the plant is being developed through a 60:40 equity partnership between Dangote Group and Ethiopian Investment Holdings (EIH). Slated to begin operations in 2029, it will become East Africa’s largest modern fertilizer hub, meeting Ethiopia’s import needs while supplying regional markets.
Natural gas for the project will come from the Calub Gas Field in Ethiopia’s Ogaden Basin and delivered via a dedicated 108-kilometre pipeline directly to the complex. The initiative aligns with Africa’s broader goal of creating an integrated energy-to-food value chain, harnessing local resources to reduce reliance on imports and strengthen industrial autonomy.
Aliko Dangote, CEO of Dangote Industries Limited, emphasized the project’s transformative potential: “Africa cannot continue exporting raw materials while importing finished products. Through seamless integration with GCL, we aim to establish an efficient closed-loop value chain from gas extraction to fertilizer production, taking a crucial step toward food security and industrial independence.” GCL Chairman Zhu Gongshan added that the partnership would expand Ethiopia’s energy, chemical, and food security sectors, leveraging both Chinese technology and Dangote’s industrial footprint.
Industry analysts highlight the project’s strategic benefits: it will advance Ethiopia’s fertilizer self-sufficiency, stimulate economic growth in the Somali Region, create thousands of jobs, and foster regional infrastructure development. By integrating upstream gas extraction, midstream pipeline transport, and downstream fertilizer production, the project forms a full “gas-to-fertiliser” industrial chain. As a flagship initiative under the Belt and Road framework, it marks a historic milestone for China–Africa industrial cooperation and positions East Africa as a hub for modern fertilizer production.
source: The Sun