Dangote to Fund $660m Ethiopia-Djibouti Fuel Pipeline

Aliko Dangote, the continent's wealthiest individual, has unveiled a major infrastructure project aimed at slashing the fuel supply chain between Djibouti and Ethiopia. The ambitious $660m pipeline, spanning 120km, seeks to condense the current five-day journey between Djibouti's Damerjog port and Addis Ababa to a mere one day.

The pipeline will terminate at a Dewele distribution facility, boasting a storage capacity of approximately 400 million litres.

"This is our company" Dangote said at the major ceremony, speaking on behalf of his company, Dangote Cement, which has production capacity of about 55 million tonnes a year. The project will strengthen Ethiopia's energy security and make its fuel supply chain more resilient.

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Ethiopian Prime Minister Abiy Ahmed praised the initiative, saying it would reduce pressure on existing transport systems supporting industries. This includes transport, aviation, agriculture, and construction.

Landlocked Ethiopia relies heavily on Djibouti's port for imports, including petroleum products. The new infrastructure is expected to increase port activity, create jobs, and boost government revenues. Djibouti is also set to benefit from increased economic activity, further solidifying its position as a key regional hub.

African business mogul Dangote Cement is poised for significant expansion, with its annual production capacity already exceeding 55 million tonnes. The company's Nigerian oil refinery, currently processing 700,000 barrels of crude daily, is set to more than double its capacity to 1.4 million barrels per day.

This expansion is part of a broader strategy to raise approximately $1.63 billion through the listing of 4.1 billion ordinary shares on the Nigerian stock exchange. Meanwhile, the company is also on track to launch a new 700,000-barrel-per-day refinery in Lamu, Kenya, slated for major next week.

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Landlocked Ethiopia's reliance on Djibouti's port for imports has long been a subject of concern. The new pipeline is expected to alleviate some of this pressure. Reducing the time and cost associated with transporting fuel and other essential goods.

Dangote's expansion plans across Africa are set to have a significant impact on the continent's energy landscape. With multiple projects underway, including the pipeline and refinery in Kenya, Dangote Cement is poised to become a major player in Africa's energy sector.

The completion of the pipeline project is expected to have far-reaching consequences for Ethiopia and Djibouti. With the new infrastructure in place, both countries can expect to see increased economic activity, job creation, and improved energy security.