Dangote to build $2.5 billion urea plant in Ethiopia

Nigerian fertilizer major Dangote and Ethiopian Investment Holdings (EIH) have signed an agreement to develop a urea production complex in Gode, Ethiopia.

The project will have an annual capacity of up to 3m. tonnes, a capacity that positions the facility among the largest urea factories in the world.

The agreement also includes outlines for plans for potential future expansion in the production of ammonia-based fertilizers, including ammonium nitrate (AN), calcium ammonia nitrate (CAN) and ammonium sulphate (amsul).

Estimated to cost up to $2.5 billion, completion of the huge project is targeted within 40 months from commencement, the pair said in a statement without providing a start date for construction.

The project is expected to reduce Ethiopia’s dependence on fertilizer imports, coming at a time when the East African nation’s imports of urea have risen.

In January-July this year, Ethiopia imported a record 616,000t of urea for the period, with that total fast approaching the 707,000t procured in 2024 and the 765,000t imported in 2023.

For the last five years, Egypt has been the largest supplier of fertilizer to Ethiopia. However, thus far this year, imports from the North African country are significantly lower, on account of gas issues hindering export ability.

Dangote and EIH said the plant could ease future risks to supply and produce enough material to enable exports to neighbouring countries. EIH will hold a 40% equity stake of the facility, while Dangote will maintain 60% ownership.

By Robert Prendergast, Nitrogen Market Reporter