Dangote Signs $4.2bn Gas Deal with China’s GCL

Dangote Industries Limited (DIL) has signed a landmark US$4.2 billion, 25‑year natural gas supply agreement with China’s GCL Group to power its fertilizer megaproject in Ethiopia.

The deal, formalized in Lagos, is being hailed as one of the most significant China–Africa industrial partnerships to date.

Under the agreement, GCL will supply natural gas from Ethiopia’s Calub Gas Field in the Ogaden Basin via a dedicated 108‑kilometre pipeline to Dangote’s upcoming fertilizer complex in Gode, Somali Region.

The $2.5 billion plant, developed in partnership with Ethiopian Investment Holdings, is scheduled to begin operations in 2029.

Once commissioned, the facility will produce three million tonnes of urea annually, making it East Africa’s largest fertilizer hub. Analysts say the project will meet Ethiopia’s current import demand and supply neighbouring markets, reshaping the region’s agricultural landscape.

Aliko Dangote, President of Dangote Industries, described the deal as transformative. “Africa’s energy industry cannot continue indefinitely exporting raw materials while importing finished products.

“Through seamless integration and strategic cooperation with GCL, we will achieve an efficient closed‑loop value chain from natural gas extraction to fertilizer production,” he said.

GCL Chairman Zhu Gongshan praised Ethiopia’s role in facilitating the partnership. “This cooperation will expand new frontiers in Ethiopia’s energy, chemical, and food security sectors while transitioning toward a mutually beneficial ecosystem‑based framework,” he noted.

Industry analysts highlight the project’s strategic value, including job creation, infrastructure development, and alignment with global low‑carbon trends. The clean chemical pathway based on natural gas is expected to provide a model for green industrial growth across Africa.

The collaboration is also seen as a landmark Belt and Road Initiative project. By integrating upstream resource development, midstream pipeline transport, and downstream fertilizer production, it establishes a closed‑loop “gas–fertilizer” chain, combining Chinese technology with Africa’s resource base to advance food security and industrial autonomy.