Dangote, Ethiopia and Djibouti Sign $660M Fuel Pipeline Deal

Nigerian billionaire Aliko Dangote has agreed with Ethiopia and Djibouti to develop a $660m (£500m) petroleum pipeline and storage project linking the two countries.

The project includes a 120km (75 mile) pipeline connecting Djibouti's Damerjog port to a distribution facility in Dewele, Ethiopia, plus storage capacity of about 400 million litres. Operations are expected to begin within 18 months.

Ethiopian Prime Minister Abiy Ahmed said the pipeline would cut the time needed to transport fuel from Djibouti's port to the Ethiopian capital, Addis Ababa, from five days to one.

The first phase will move key petroleum products, including jet fuel, diesel and petrol.

Speaking at the groundbreaking ceremony, Dangote said the project would strengthen Ethiopia's energy security and make its fuel supply chain more resilient.

Landlocked Ethiopia depends heavily on Djibouti's port for imports, including petroleum products. The new infrastructure is expected to ease pressure on existing transport systems that support industries including transport, aviation, agriculture and construction.

Djibouti stands to gain from increased port activity, job creation and higher government revenues.

The deal forms part of Dangote's wider expansion of infrastructure and manufacturing businesses across Africa. Dangote Cement holds production capacity of about 55 million tonnes a year, while his oil refinery in Nigeria currently processes 700,000 barrels of crude a day and seeks to double that to 1.4 million barrels a day.

The refinery recently listed 4.1 billion ordinary shares on the Nigerian stock exchange, aiming to raise about $1.63bn (£1.2bn).

In Kenya, the company is due to break ground next week on a proposed 700,000-barrel-a-day crude oil refinery in Lamu.

With the pipeline promising a five-fold cut in delivery times and storage of 400 million litres, the project could reshape fuel logistics across one of Africa's fastest-growing economies — and extend Dangote's footprint across the continent's energy infrastructure.