Ethiopia, Djibouti, and Nigerian billionaire Aliko Dangote plan to build a $660 million pipeline to carry refined fuel between the two neighbours. A spokesperson in Prime Minister Abiy Ahmed’s office announced the plan to Reuters on September 24. The project is to include a pipeline of about 120 kilometers, with storage for about 375,000 cubic metres of fuel at Damerjog in Djibouti, about 375 million litres, and about 800,000 cubic metres at Dewele in Ethiopia. The spokesperson said it should start working within 18 months.
Abiy Ahmed said on his X account that Ethiopian Investment Holdings and the Dangote Group would develop the project together. He said it aims to cut transport costs and delays on the Ethiopia-Djibouti corridor. He made the announcement in Djibouti beside President Ismail Omar Guelleh and Dangote.
BBC reporting on the ceremony said Abiy Ahmed expects the pipeline to cut the time needed to move fuel from Djibouti’s port to Addis Ababa from five days to one. The first phase is expected to carry jet fuel, diesel, and petrol. Dangote said at the ground-breaking that the project would strengthen Ethiopia’s energy security and make its fuel supply chain more resilient. The BBC also said Djibouti expects more port activity, jobs, and government revenue from the project.
The BBC headline mentioned $600 million, while its article and Reuters used $660 million. The BBC gave storage as “about 400 million litres” without saying which tank that figure is. That is not the same quantity as the 375,000 cubic metres at Damerjog, about 375 million litres, or the 800,000 cubic metres at Dewele, which Reuters reported for each site.
Reuters noted that the Dangote Group is separately building a $4 billion fertiliser pipeline and power plant in Ethiopia, as well as a plastic packaging factory. It said Dangote and Kenya are due to break ground on a proposed crude oil refinery in Lamu that would process 700,000 barrels per day. The BBC added that Dangote Cement has production capacity of about 55 million tonnes a year, and that Dangote’s Nigerian refinery plans to double its capacity.
The announcement came during fighting in northern Ethiopia near the same corridor. Agence France-Presse (AFP) reported on September 25 that the Tigrayan offensive in Afar is likely aimed at cutting supplies from Djibouti, which provides almost all of Ethiopia’s international trade cargo, including fuel. ACLED reported clashes along the Tigray-Afar border and in Amhara on September 24.
African Security Analysis (ASA), a research group, said in its September 15 assessment of Bab el-Mandeb that Djibouti, Ethiopia, and the wider East African logistics system would face higher transport costs and supply-chain disruption. It said Ethiopia faces significant indirect exposure because it depends on the Djibouti corridor. Ministry figures for 2025/26, reported by Birr Metrics, put Djibouti’s share of Ethiopia’s cargo through sea gateways at 96.7 percent.
Some details are not yet public. The reports did not include engineering milestones, confirmed financing, or security plans for the route.
Sources: