March 16, (THEWILL) — Africa’s leading industrial conglomerate, Dangote Industries Limited, has signed a landmark $4.2 billion, 25-year natural gas supply agreement with China’s major energy company, GCL Group, to power a large fertiliser production project in Ethiopia.
The agreement, signed in Lagos, is expected to support Dangote Group’s expansion in East Africa and deepen industrial cooperation between China and Africa.
Under the arrangement, GCL Group will supply stable natural gas to Dangote Group’s planned three-million-tonne-per-year urea fertiliser production complex currently under development in Ethiopia.
The fertiliser facility, valued at about $2.5 billion, is being developed through a 60:40 equity partnership between Dangote Group and Ethiopian Investment Holdings (EIH), the Ethiopian government’s investment arm.
According to the partners, the fertiliser plant is expected to commence operations in 2029, and once completed, will become East Africa’s largest modern fertiliser production hub.
The project is expected to fully meet Ethiopia’s current urea import demand while supplying neighbouring countries across East Africa, significantly reducing dependence on fertiliser imports in the region.
Natural gas for the project will be sourced from the Calub Gas Field located in Ethiopia’s Ogaden Basin and transported through a 108-kilometre dedicated pipeline to the fertiliser complex in Gode, within the Somali Region.
The integrated project aligns with Africa’s broader ambition to build energy-to-food industrial value chains, using locally sourced natural gas to support fertiliser production and agricultural growth.
President and Chief Executive of Dangote Industries Limited, Aliko Dangote, said the collaboration represents a critical step toward strengthening Africa’s industrial capacity and food security. He noted that Africa must move beyond exporting raw resources and instead focus on building domestic industries capable of converting natural resources into finished products.
According to him, the partnership with GCL will create an integrated closed-loop value chain linking natural gas extraction to fertiliser production, helping Africa move closer to agricultural self-sufficiency.
Chairman of GCL Group, Zhu Gongshan, described the agreement as a strategic milestone that would unlock new opportunities in Ethiopia’s energy, chemical and agricultural sectors. He added that the cooperation reflects a shift toward a mutually beneficial ecosystem-based partnership model, combining Chinese technology with Africa’s resource potential and market opportunities.
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