Ethiopia, Dangote Group ink US$2.5B deal to build country’s largest urea fertilizer plant
The agreement was signed in the presence of Prime Minister Abiy Ahmed and the Nigerian business tycoon, Aliko Mohammad Dangote.
ETHIOPIA – Ethiopian Investment Holdings (EIH), the strategic investment arm of the Government of Ethiopia, has entered into a landmark shareholders’ agreement with Dangote Group to establish a world-class urea fertilizer production complex in Gode, Somali Regional State.
The agreement, signed on Friday August 29, positions Ethiopia to become a leading fertilizer producer on the African continent while reducing its heavy reliance on imports.
According to the statement released, the US$2.5 billion project represents one of the largest industrial investments in Ethiopia’s history and will set up one of the world’s largest single-site urea fertilizer production facilities. With an annual production capacity of up to three million metric tons, the plant will rank among the top five globally.
Under the partnership, Dangote Group will hold a 60% ownership stake, while EIH will retain 40% equity.
Integrated development plan
The project includes the development, construction, and operation of state-of-the-art urea fertilizer plants and supporting infrastructure.
A major feature will be a dedicated natural gas pipeline connecting Ethiopia’s Hilal and Calub gas reserves to the Gode site, securing feedstock supply for decades. Additional facilities will cover storage, logistics, and export capacity to serve both domestic and regional markets.
Beyond urea production, the agreement provides for future expansion into other ammonia-based fertilizers such as ammonium nitrate, ammonium sulfate, and calcium ammonium nitrate. This diversification is designed to meet the varied nutrient needs of Ethiopian soils and strengthen the country’s role as a regional fertilizer hub.
Aliko Dangote, President and Chief Executive of Dangote Group, emphasized the significance of the deal.
“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,” he said.
Dr. Brook Taye, Chief Executive Officer of Ethiopian Investment Holdings, noted the alignment of the project with Ethiopia’s national development priorities.
“This landmark agreement with Dangote Group marks a significant milestone in Ethiopia’s journey toward industrial self-sufficiency and agricultural modernization. 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,” he reiterated.
Agriculture accounts for more than 70% of Ethiopia’s employment and is the backbone of the national economy.
However, fertilizer use has traditionally been constrained by high import costs and foreign exchange shortages. According to the World Bank, Ethiopia imports over 1.5 million tons of fertilizer annually, making it vulnerable to global supply disruptions and price volatility.
The Gode fertilizer complex is expected to alleviate these challenges by providing reliable access to locally produced fertilizers at competitive prices.
In addition, the project is expected to create thousands of direct and indirect jobs in the Somali Regional State and beyond, stimulate local supply chains, and attract ancillary investments in logistics and services.
Sign up to HERE receive our email newsletters with the latest news and insights from Africa and around the world, and follow us on our WhatsApp channel for updates.
