Aliko Dangote Partners Ethiopia to Build $2.5B World-Class Fertilizer Plants

Aliko Dangote, Chairman of the Board of Directors, Dangote Cement Plc. have announced the signing of a comprehensive shareholders’ agreement to develop, construct, and operate a world-class urea fertilizer production complex in Gode, Ethiopia.

The agreement was signed on Thursday between Dangote Group and Ethiopian Investment Holdings, the government’s strategic investment arm. Under the agreement, Dangote Group will hold 60 per cent equity, while EIH will retain 40 per cent.

“The ambitious project will establish one of the world’s largest single-site urea fertilizer production complexes, with production facilities boasting a combined capacity of up to three million metric tons per annum,” EIH stated. The facility will rank among the top five largest urea production complexes globally.

Under the agreement, the two companies will jointly develop, own, construct, operate, maintain, insure, and finance the state-of-the-art urea fertilizer plants and associated infrastructure.

The comprehensive development includes advanced gas transport pipelines to evacuate natural gas from Ethiopia’s Hilal and Calub reserves, storage facilities, logistics infrastructure, and export capabilities designed to serve both domestic and regional markets.

The agreement also provides for potential expansions, upgrades, and similar fertilizer production initiatives in ammonia-based fertilizers, including ammonium nitrate, ammonium sulfate, and calcium ammonium nitrate, further cementing Ethiopia’s position as a regional fertilizer production hub.

The Project Development Costs are estimated not to exceed $2.5 billion USD, with completion targeted within 40 months from commencement.

One of the major components of the investment includes the construction of a dedicated pipeline infrastructure to transport natural gas from Ethiopia’s proven Hilal and Calub gas reserves to the Gode production facility, ensuring a reliable and cost-effective feedstock supply for the fertilizer complex.

The investment enhances the two companies’ commitment to transforming Ethiopia’s agricultural sector and enhancing food security across the region.

It will also reduce Ethiopia’s dependence on fertilizer imports while creating thousands of direct and indirect employment opportunities in the Somali Regional State and beyond.

According to Aliko Dangote, “This partnership with Ethiopian Investment Holdings represents a pivotal moment in our shared vision to industrialize Africa and achieve food security across the continent.

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. The 60-40 partnership structure reflects our commitment to this transformative project while ensuring strong Ethiopian participation.”

Chief Executive Officer of Ethiopian Investment Holdings, Dr. Brook Taye, stated: “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% stake in what will be one of the world’s largest urea production facilities. The project aligns perfectly with our national development priorities and will substantially enhance our agricultural productivity while positioning Ethiopia as a regional hub for fertilizer production.

“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.” He stated.