By Ayomide Otitoju
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 power Dangote Group’s major expansion projects in Ethiopia. The deal, formalized in Lagos, is one of the most significant China–Africa industrial partnerships to date.
Under the agreement, GCL Group will supply natural gas to Dangote Group’s upcoming 3‑million‑tonne-per-year urea fertilizer complex in Ethiopia, a US$2.5 billion project being developed under a 60:40 equity structure between Dangote Group and Ethiopian Investment Holdings (EIH). The plant, scheduled to begin operations in 2029, will become East Africa’s largest modern fertilizer hub, meeting Ethiopia’s domestic urea demand and supplying regional 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 fertilizer complex in Gode, Somali Region. The initiative aligns with Africa’s goal of creating an integrated energy-to-food value chain, leveraging local resources to drive industrial autonomy.
Aliko Dangote, President and CEO of Dangote Industries Limited, described the collaboration as a step toward greater African self-reliance in food security. “Africa’s energy industry cannot continue indefinitely exporting raw materials while importing finished products. Through strategic cooperation with GCL, we will achieve an efficient closed-loop value chain from natural gas extraction to fertilizer production,” he said.
Zhu Gongshan, Chairman of GCL Group, highlighted the role of the Ethiopian government in facilitating the deal. “This cooperation will enable both sides to expand Ethiopia’s energy, chemical, and food sectors, moving toward a mutually beneficial ecosystem-based framework,” he said.
Industry analysts say the project will not only help Ethiopia achieve fertilizer self-sufficiency but also unlock the industrial potential of the Somali Region, create thousands of jobs, and boost regional infrastructure development. Its natural gas-based production pathway also aligns with global low-carbon and green industrial trends.
The partnership represents a new model for China–Africa collaboration, integrating upstream resource development, midstream pipeline transportation, and downstream industrial transformation into a complete “gas–fertilizer” chain. The project is also part of the Belt and Road Initiative, reinforcing sustainable development through energy independence, industrial growth, and food self-sufficiency.
Dangote Group, founded by Africa’s richest man, Aliko Dangote, operates across cement, food processing, energy, and chemicals, earning recognition as the “Father of African Industry.” The selection of GCL Group as a strategic partner reflects the confidence Africa’s leading enterprises have in the company’s technological expertise and localized operational capacity.
