Dangote Gas Deal signals new era for Ethiopia’s fertiliser industry

Dangote Group has moved decisively to reshape Ethiopia’s agricultural future by securing a long term gas supply agreement to support a major fertiliser project in the east of the country.

The deal, announced on 16 March, spans 25 years and was signed with GCL Group. Valued at around US$4.2bn, it will provide the energy needed for a large fertiliser plant currently being built in Gode.

Gas for the project will come from the Calub field and will be transported through a 108 kilometre pipeline directly to the plant. This direct link is expected to reduce supply risks and improve efficiency, something that has often been a challenge for industrial developments across the continent.

Aliko Dangote, chairman and chief executive of Dangote Industries Limited, said, "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 has been working with the Ethiopian government on the Ogaden gas project since 2013. The first phase began operations on 2 October 2025 and can produce 111 million litres of liquefied natural gas each year. Plans for a second phase aim to increase output significantly, although no timeline has been confirmed.

The fertiliser plant in Gode is expected to start operating by 2029, with an annual capacity of three million tonnes of urea. The project represents an investment of US$2.5bn and is intended to reduce Ethiopia’s reliance on imported fertilisers while supplying neighbouring markets.

At present, Ethiopia produces no inorganic fertilisers domestically and imported about 2.32 million tonnes in 2024. Once completed, this project could transform the country’s agricultural supply chain and strengthen food production across the region.