The government of Ethiopia has laid the foundation stone for two landmark industrial projects in the Somali Region, the Gode Oil Refinery and a US $2.5bn urea fertilizer plant. Ethiopian Prime Minister Abiy Ahmed performed the ceremony marking another major step in the country’s industrialization and energy self-sufficiency drive.
The Gode Oil Refinery, to be developed by China’s Golden Concord Group Limited (GCL), will process about 3.5 million tons of crude oil per year equivalent to roughly 70,000 barrels per day using feedstock from the Hilala oil field with a 108-kilometer pipeline planned to transport natural gas to the site.
Once operational, the facility is expected to produce various petroleum products, including diesel, petrol, jet fuel, and liquefied petroleum gas, reducing Ethiopia’s heavy dependence on imported refined fuels. Beyond meeting domestic demand, the project is envisioned to support exports to neighboring markets such as Somalia, Djibouti, and Kenya. It is also anticipated to create thousands of jobs, boost local infrastructure, and position Gode as a strategic energy and industrial hub in eastern Ethiopia.
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Industrial growth
The fertilizer plant, to be developed by Ethiopian Investment Holdings (EIH) in partnership with Nigeria’s Dangote Group, will have an annual production capacity of three million tons. The facility will utilize natural gas from the Calub fields. Under the partnership agreement signed in August 2025, EIH holds a 40% stake, while Dangote Group owns 60%.
Prime Minister Abiy described the projects as historic milestones for national development and unity. “These projects represent more than industrial progress; they embody our shared responsibility to harness opportunities, strengthen cooperation, and promote peace,” he said.
The Prime Minister emphasized that the initiatives would accelerate Ethiopia’s industrial growth, reduce import dependency, and create new employment opportunities across the Somali Region, which hosts the country’s key natural-gas reserves.
Earlier in the week, Prime Minister Abiy inaugurated the first phase of the Ogaden Liquified Natural Gas (LNG) Project in Calub a multipurpose facility expected to produce 111 million litres of gas and 1,000 megawatts of electricity. He also laid the foundation for Phase II, which will have an annual capacity of 1.3 billion litres.
Combined, the fertilizer, refinery, and LNG projects represent an estimated US $10bn investment, positioning the Somali Region as a major industrial and energy hub. According to government spokesperson Billene Seyoum, the first construction phases of both the fertilizer and refinery projects are expected to be completed within 24 months.
Ethiopia, home to more than 135 million people, continues to scale up infrastructure and energy investments as part of its industrialization agenda. The latest developments come less than a month after the country inaugurated the Grand Ethiopian Renaissance Dam (GERD) Africa’s largest hydropower facility, capable of generating over 5,000MW of electricity.
