A $660m (£500m) fuel pipeline backed by Nigerian billionaire Aliko Dangote is set to link Ethiopia with Djibouti, in a project designed to strengthen fuel supplies to the landlocked country.
The development will feature a 120km (75-mile) pipeline running from Djibouti’s Damerjog port to a distribution centre in Dewele, Ethiopia, alongside storage facilities capable of holding about 400 million litres.
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Operations are expected to start within 18 months.
Ethiopian Prime Minister Abiy Ahmed said the pipeline would cut the journey time for fuel transported from Djibouti’s port to the capital, Addis Ababa, from five days to just one.
During its first phase, the system will carry essential petroleum products, including jet fuel, diesel and petrol.
At the ground-breaking ceremony, Dangote, Africa’s richest man, said the investment would improve Ethiopia’s energy security and build greater resilience into its fuel supply network.
Ethiopia depends heavily on Djibouti’s port to receive imports, including petroleum products. The new infrastructure is expected to ease pressure on the transport networks that serve major sectors such as aviation, agriculture, construction and road transport.
Djibouti is also expected to gain from increased port traffic, new employment opportunities and higher government revenues.
The pipeline forms part of Dangote’s broader drive to expand his infrastructure and manufacturing interests across Africa.
Dangote Cement has annual production capacity of about 55 million tonnes. His Nigerian oil refinery can currently process 700,000 barrels of crude a day and is pursuing plans to double capacity to 1.4 million barrels a day.
The refinery recently listed 4.1 billion ordinary shares on the Nigerian stock exchange in an effort to raise about $1.63bn (£1.2bn).
In Kenya, the company is scheduled to break ground next week on a proposed 700,000-barrel-a-day crude oil refinery in Lamu.
