Foundation Stone Laid as EIH Signs MoU for $660m Ethiopia-Djibouti Petrolium Pipeline

ADDIS ABABA – Ethiopian Investment Holdings (EIH) partnered with Dangote Group and Djibouti’s state-owned investment firm to develop a petroleum pipeline infrastructure linking the two East African countries, with storage terminals at both ends.

The 660 million USD infrastructure is expected to establish an integrated petroleum products supply chain connecting marine receipt and storage facilities in Damerjog with pipeline, storage and distribution facilities in Dewele.

It is designed with the aim to improve Ethiopia’s energy security, boost regional trade links, and ensure “the safe, reliable and efficient transport” of petroleum products from Djibouti, per the PM office.

The project will be developed by the government’s strategic investment arm Ethiopian Investment Holdings (EIH) and Nigeria’s Dangote Industries Limited in partnership with Djibouti’s Great Horn Investment Holding S.A.

The trio signed a Memorandum of Understanding to advance the development of the infrastructure on Thursday – the same day the foundation stone for the project was laid by Prime Minister Abiy Ahmed (PhD), Djibouti president Ismail Omar Guelleh, and Dangote Group chief Alhaji Aliko Dangote.

“More than a pipeline, this is an investment in future growth, regional integration and a more secure shared economic future – with African investment at its center,” Prime Minister Abiy Ahmed hailed the project after the launch.

The project involves building a 120-kilometer long petroleum pipeline and terminals with over a million cubic meters of combined storage capacity at the two ends. It is estimated to cost 660 million US dollars, ending with a project completion timeline of less than two years.

EIH Chief Executive Officer Brook Taye hailed the project as bold infrastructure with potential to improve regional integration and competitiveness.

“Africa needs bold infrastructure that removes bottlenecks and unlocks economic potential. This project presents an opportunity to strengthen Ethiopia’s petroleum supply chain, improve regional connectivity and enhance the country’s competitiveness,” Brook said.

He added, the initiative also “has the potential to improve supply efficiency, deepen regional integration and support more sustainable petroleum products transportation”.

The initiative builds on the growing partnershiop between the EIH and Dangote Group, including a joint investment on the USD 2.5 billion urea fertilizer production complex in Gode, with a planned production capacity of three million metric tonnes of urea annually.