Dangote Industries Limited (DIL) and GCL Group, China’s leading private energy conglomerate, have signed a landmark US$4.2 billion, 25‑year natural gas supply agreement to support Dangote Group’s major expansion projects in Ethiopia. The deal, formalized in Lagos, strengthens one of the most significant industrial partnerships between China and Africa to date.
Under the agreement, GCL Group will supply natural gas to Dangote Group’s upcoming 3‑million‑tonne‑per‑year urea fertilizer production complex in Ethiopia, a US$2.5 billion project being developed under a 60:40 equity structure with Ethiopian Investment Holdings (EIH). The facility is scheduled to begin operations in 2029 and will become East Africa’s largest modern fertilizer hub, meeting Ethiopia’s urea demand while supplying neighboring markets.
The gas will be sourced from the Calub Gas Field in Ethiopia’s Ogaden Basin and delivered via a dedicated 108‑kilometre pipeline to the Dangote fertilizer complex in Gode, Somali Region. The project is designed to establish an integrated energy-to-food value chain, leveraging local resources to drive industrial autonomy in Africa.
Aliko Dangote, President and CEO of DIL, emphasized the strategic importance of the partnership, stating, “Africa’s energy industry cannot continue indefinitely exporting raw materials while importing finished products. Through seamless integration with GCL, we aim to create a closed-loop value chain from natural gas extraction to fertilizer production, enhancing Africa’s food security and industrial self-reliance.”
Mr. Zhu Gongshan, Chairman of GCL Group, noted that the cooperation was facilitated by the Ethiopian government. “This partnership will expand Ethiopia’s energy, chemical, and food security sectors, creating a mutually beneficial ecosystem. Leveraging GCL’s gas operations and Dangote’s industrial footprint, we can enhance service capabilities and market reach across Africa,” he said.
Industry analysts highlight the project’s strategic significance: it is expected to enable Ethiopia’s fertilizer self-sufficiency, unlock the industrial potential of the Somali Region, generate thousands of jobs, and advance regional infrastructure. By using natural gas as a feedstock, the project also supports a low-carbon industrial pathway, aligning with global sustainability trends.
The initiative forms a complete closed-loop “gas-to-fertilizer” industrial chain, combining Chinese technological expertise with Africa’s resource endowments. It is also a landmark project under the Belt and Road Initiative, illustrating how energy development can drive agricultural advancement and broader sustainable development goals in Ethiopia and the region.
Dangote Group, founded by Africa’s richest individual, Aliko Dangote, operates across sectors including cement, food processing, energy, and chemicals. The partnership with GCL Group underscores Africa’s leading enterprises’ recognition of China’s technological capabilities and local operational expertise.
