Ethiopia and Djibouti are set to strengthen regional fuel supply and trade connectivity with the construction of a $660 million oil terminal and pipeline project by Dangote Group.
The 120 kilometre Damarjog-Dewele multiproduct pipeline will link marine and coastal storage facilities at Damarjog in Djibouti with inland storage and distribution facilities at Dewele in Ethiopia.
The project was officially launched with a groundbreaking ceremony at the Damerjog Industrial Development Free Trade Zone in Djibouti, with Ethiopian Prime Minister, Dr. Abiy Ahmed, and Djibouti President, Ismaïl Omar Guelleh, describing the investment as significant to regional energy security and economic integration.
Guelleh said the project would increase trade volumes, expand port operations, attract investment and create direct and indirect employment, while strengthening Djibouti’s position as a logistics and energy hub.
For Ethiopia, Abiy said the pipeline would provide a more reliable and cost-effective system for transporting refined petroleum products into the country, helping to reduce supply chain vulnerabilities and transportation bottlenecks.
He said improved access to petroleum products would support aviation, transportation, agriculture, manufacturing, construction and other industrial activities, while reducing losses associated with long-distance transportation.
The project also forms part of the economic partnership between Ethiopia and Djibouti, whose corridor currently serves as a major route for Ethiopia’s imports and exports, including petroleum products.
Dangote Industries Limited President and Chief Executive, Aliko Dangote, said the project was designed to improve energy security and supply chain efficiency while creating economic opportunities in both countries.
According to Dangote, Djibouti is expected to benefit from increased port activity, revenues and employment, while Ethiopia would gain improved energy security and fewer logistics bottlenecks.
He said the pipeline would also reduce dependence on long-distance tanker transportation, easing congestion and operational risks and reducing the potential for product losses and environmental incidents.
The project is expected to create jobs during construction and operation while supporting local contractors, suppliers, transport operators and host communities through skills transfer and increased economic activity.
The Damarjog-Dewele project is part of Dangote Group’s Vision 2030 strategy to invest $50 billion across Africa in industrial and energy infrastructure aimed at supporting regional trade, industrialisation and economic self-sufficiency.
Dangote said the group’s broader objective was to support African countries in increasing local production and reducing dependence on imports.