On March 18, it was announced that Nigeria's Dangote Group and GCL Group have signed a 25-year natural gas supply agreement valued at approximately $4.2 billion. The contract is intended to support the construction of a large fertilizer production project in Ethiopia.

Under the agreement, GCL Group will utilize natural gas resources from the Calub gas field in the Ogaden Basin to provide energy for a comprehensive urea fertilizer production base planned by Dangote Group in the Somali Region.

The project is expected to commence operations in 2029, with an annual production capacity of 3 million tons. Upon completion, it will become the largest modern fertilizer production base in East Africa. Natural gas will be transported via a dedicated pipeline approximately 108 kilometers long to the fertilizer production facility located in Gode. The total investment in the project is estimated at around $2.5 billion, with Dangote Group holding a 60% stake and Ethiopian Investment Holdings (EIH) holding the remaining 40%.

Zhu Gongshan, Chairman of GCL Group, stated that the collaboration will combine GCL's expertise in energy infrastructure with Dangote Group's extensive manufacturing footprint across the African continent.

Analysts suggest that countries in the region currently rely heavily on fertilizer imports to meet agricultural production demands. Once operational, the project will be capable of fulfilling Ethiopia's entire domestic urea requirements and providing a stable supply to neighboring markets.

Industry observers note that the integrated model, which combines upstream natural gas extraction, midstream pipeline transportation, and downstream fertilizer production, not only establishes a new paradigm for large-scale China-Africa industrial cooperation but also aligns with the global trend of promoting low-carbon industrial production using natural gas as a feedstock.