friday 29 Aug 2025 {HMC}Ethiopian Investment Holdings (EIH), the government’s strategic investment arm, and Dangote Group have signed a landmark shareholders’ agreement to develop and operate a $2.5 billion urea fertilizer production complex in Gode, Somali Regional State.
According to a statement released today, EIH will hold a 40% equity stake, while Dangote Group will retain 60% ownership. The facility, with a planned capacity of three million metric tons of urea annually, will be among the top five largest urea production complexes globally and the single largest in Ethiopia’s history.
The project includes construction of fertilizer plants and associated infrastructure, including a pipeline to transport natural gas from the Calub and Hilala gas fields. It also envisions potential expansion into ammonia-based fertilizers such as ammonium nitrate, ammonium sulfate, and calcium ammonium nitrate.
Aliko Dangote, Chairman of Dangote Group, described the agreement as “a pivotal moment in our shared vision to industrialize Africa and achieve food security.” He added that Ethiopia’s location and gas reserves make Gode an ideal site for what will become “one of the world’s largest fertilizer complexes.”
Brook Taye (PhD), CEO of Ethiopian Investment Holdings, called the deal “a significant milestone in Ethiopia’s journey toward industrial self-sufficiency and agricultural modernization.” He stressed that the utilization of domestic gas reserves would ensure “energy security and cost competitiveness for decades to come.”
Prime Minister Abiy Ahmed said the project will create local jobs and ensure a reliable fertilizer supply for farmers who have long faced challenges, describing it as “a decisive step in our path to food sovereignty.” He added that the initiative “strengthens Ethiopia’s competitiveness across the continent and reflects our commitment to executing strategic investments that serve our people and our future.”
PM Abiy first spoke of the fertilizer factory which he said will be inaugurated after 40 months of development during a parliamentary session on 03 July 2025. Highlighting the critical link between domestic fertilizer production and agricultural productivity, he said, “the agricultural sector will only be complete and effective when there is a local fertilizer factory.”
The announcement was made a week after Ethiopia reached an agreement with Dangote Industries to establish a large-scale fertilizer plant in the Somali Regional State.
The deal expands Dangote’s presence in Ethiopia, where it already operates a cement plant, while marking another milestone for EIH following its first international investment in Akobo Minerals.
Agriculture, which employs over 70% of Ethiopia’s population, is expected to benefit directly from the project through improved access to fertilizer at competitive prices. The partners highlighted that the project would boost crop yields, enhance food security, and generate economic benefits beyond Ethiopia by supplying fertilizers to neighboring countries.
Farmers in Ethiopia face a severe shortage of chemical fertilizers – now costing twice as much as last year-threatening both crop yields and livelihoods. Each year, subsistence farmers across the country grapple with limited access to fertilizer, raising fears of missing the planting season.
source hiiraan online
