Dangote Industries Limited (DIL) and China's GCL Group have signed a landmark $4.2 billion, 25-year natural gas supply agreement to fuel Dangote Group's major expansion in Ethiopia, particularly its planned urea fertiliser complex.
The deal, formalized in Lagos, marks one of the most significant China-Africa industrial partnerships in recent years and supports the development of East Africa's largest modern fertiliser production facility.
Under the long-term arrangement, GCL Group will provide stable natural gas to power Dangote's upcoming 3-million-tonne-per-year urea fertiliser plant in Gode, Somali Region.
The $2.5 billion project is a joint venture with a 60:40 equity split between Dangote Group (60%) and Ethiopian Investment Holdings (EIH, 40%), with operations slated to commence in 2029.
Once operational, the plant is poised to meet Ethiopia's full domestic urea import needs while exporting to neighboring countries, transforming the region's fertiliser market, curbing import dependency, and bolstering agricultural self-sufficiency.
The gas will be sourced from Ethiopia's Calub Gas Field in the Ogaden Basin and transported via a dedicated 108-kilometer pipeline directly to the fertiliser complex.
This initiative advances Africa's push for an integrated energy-to-food value chain, utilizing local resources to promote industrial autonomy and food security.
Aliko Dangote, President and Chief Executive of Dangote Industries Limited, emphasized the strategic importance: “Africa’s energy industry cannot continue indefinitely exporting raw materials while importing finished products. We must pursue a new path of highly autonomous development.
"Through seamless integration and strategic cooperation with GCL, we will achieve an efficient closed loop value chain from natural gas extraction to fertiliser production, taking a crucial step toward enabling Africa to secure greater autonomy over its food security.”
GCL Group Chairman Zhu Gongshan highlighted the mutual benefits, crediting Ethiopian government support: “This cooperation will enable both sides to expand new frontiers in Ethiopia’s energy, chemical, and food security sectors while transitioning from a ‘business going global’ model toward a mutually beneficial ecosystem-based framework.
"Leveraging GCL’s integrated oil and gas operations in Ethiopia and Dangote Group’s extensive industrial footprint across Africa, the partnership will significantly enhance our service capabilities and market reach across the continent.”
The agreement aligns with broader efforts to leverage Ethiopia's natural gas reserves for industrial growth and regional economic development.
Click to signup for FREE news updates, latest information and hottest gists everyday
Advertise on NigerianEye.com to reach thousands of our daily users
No comments
Post a Comment
Kindly drop a comment below.
(Comments are moderated. Clean comments will be approved immediately)
Advert Enquires - Reach out to us at NigerianEye@gmail.com