Nigerian billionaire Aliko Dangote has announced co-investment in a $660 million petroleum pipeline connecting Ethiopia to Djibouti, a project expected to dramatically cut the time and cost of delivering fuel to one of Africa's most populous landlocked nations. Ethiopian Prime Minister Abiy Ahmed and Djibouti President Ismail Omar Guelleh joined Dangote at a ground-breaking ceremony to mark the launch of what is being described as a transformative piece of regional infrastructure.
The project will see a 120-kilometre pipeline built from the Damerjog port area on Djibouti's coast to a distribution facility at Dewele, just inside Ethiopia's border. Combined storage capacity will reach roughly 400 million litres, split between terminals at both ends of the route. Refined petroleum products — including jet fuel, diesel and petrol — will be stored at Damerjog after arriving by sea, then pumped inland to Dewele for onward distribution. The system is expected to be operational within 18 months.
The logic behind the investment is straightforward: Ethiopia, a country of around 130 million people, has no coastline and channels the vast majority of its imports through Djibouti, a small nation of roughly one million on the Horn of Africa that sits astride one of the world's busiest shipping lanes. Currently, petroleum products make the journey inland by tanker truck, a process Prime Minister Abiy Ahmed said takes up to five days from port to the capital Addis Ababa. The pipeline is projected to reduce that to a single day, easing pressure on roads, lowering logistics costs and strengthening supply reliability for industries ranging from aviation to agriculture.
The deal is part of Dangote Group's broader push to build infrastructure and manufacturing capacity across the continent. Beyond the pipeline, the conglomerate is developing a fertiliser plant and power project in Ethiopia. In Kenya's coastal Lamu County, the group is set to break ground shortly on a 700,000-barrel-a-day crude oil refinery, mirroring the scale of Dangote's existing Lagos refinery, which is itself expanding toward 1.4 million barrels a day. Djibouti is expected to benefit from increased port traffic, job creation and higher government revenues as fuel volumes through its terminals grow.
Analysts and project backers frame the pipeline as strategic on multiple levels. For Ethiopia, a dedicated fuel corridor reduces vulnerability to road disruptions and tanker shortages. For Dangote, it secures a logistics foothold in East Africa that could eventually serve as a distribution channel for fuel produced by the group's expanding refining network. The key test, as with many large infrastructure projects in the region, will be whether construction stays on schedule and whether cost savings ultimately reach consumers and businesses across Ethiopia.