Dangote Group, Ethiopia Seal $2.5bn Fertilizer Project Agreement
By Patience Ikpeme
Ethiopian Investment Holdings (EIH), the strategic investment arm of the Ethiopian government, and Dangote Group have signed a comprehensive shareholders’ agreement to jointly develop, construct, and operate a $2.5 billion urea fertilizer production complex in Gode, Ethiopia.
The project, expected to be completed within 40 months, will be one of the largest industrial investments in Ethiopia’s history. A critical component of the investment includes the construction of a dedicated pipeline to transport natural gas from the country’s Hilal and Calub reserves to the Gode production site, ensuring stable and cost-effective feedstock for the facility.
Under the agreement, EIH will hold a 40 percent equity stake while Dangote Group will maintain 60 percent ownership. The fertilizer complex, designed to produce up to three million metric tons of urea annually, will rank among the top five largest single-site fertilizer plants in the world.
The scope of the partnership covers the joint development, ownership, construction, operation, maintenance, insurance, and financing of the plants and related infrastructure. This includes advanced gas transport pipelines, storage facilities, logistics systems, and export infrastructure aimed at serving both domestic and regional markets.
The deal also allows for future expansions into other ammonia-based fertilizers such as ammonium nitrate, ammonium sulfate, and calcium ammonium nitrate. This move is intended to position Ethiopia as a regional hub for fertilizer production and reduce the country’s heavy dependence on imports.
Aliko Dangote, President and Chief Executive of Dangote Group, described the project as a “pivotal moment” in Africa’s industrialization and food security drive.
“This partnership with Ethiopian Investment Holdings represents a pivotal moment in our shared vision to industrialize Africa and achieve food security across the continent,” Dangote said. “The strategic location of Gode, combined with Ethiopia’s abundant natural gas resources from the Hilal and Calub reserves, makes this an ideal location for what will become one of the world’s largest fertilizer complexes. We are committed to bringing our decades of experience in large-scale industrial projects to ensure this venture becomes a cornerstone of Ethiopia’s industrial transformation and a catalyst for agricultural productivity throughout the region.”
Dr. Brook Taye, Chief Executive Officer of Ethiopian Investment Holdings, said the agreement marks a milestone in Ethiopia’s pursuit of industrial self-sufficiency and modernization of its agricultural sector.
“This landmark agreement with Dangote Group marks a significant milestone in Ethiopia’s journey toward industrial self-sufficiency and agricultural modernization. As the strategic investment arm of the Government of Ethiopia, EIH is proud to secure a 40 percent stake in what will be one of the world’s largest urea production facilities,” Taye stated. “The utilization of our domestic Hilal and Calub gas reserves through dedicated pipeline infrastructure ensures energy security and cost competitiveness for decades to come. We are confident that this partnership will deliver tremendous value to Ethiopian farmers, contribute to food security, and generate substantial economic benefits for our nation.”
The fertilizer complex is expected to have far-reaching economic and social impact. Agriculture employs more than 70 percent of Ethiopia’s population, and reliable access to affordable, high-quality fertilizers is seen as critical to increasing crop yields, raising farmer incomes, and meeting food security goals.
With its three-million-ton annual production capacity, the Gode facility will not only exceed the capacity of most existing fertilizer plants globally but also place Ethiopia among the major players in the international fertilizer market. The project is also expected to create thousands of direct and indirect jobs in the Somali Regional State and beyond.
Analysts say the venture demonstrates how Ethiopia’s natural gas reserves can be leveraged to drive industrial growth while supporting regional integration. By supplying fertilizers to neighboring countries, the project could help reduce import costs and enhance agricultural productivity across East Africa.
