Ethiopia-Djibouti Pipeline Project Set to Transform Regional Energy and Trade Corridor

Addis Ababa, September 24, 2026 (ENA) —Ethiopia, Djibouti and the Dangote Group have announced a major infrastructure investment aimed at improving fuel transportation, strengthening energy security and unlocking greater economic potential along the Ethiopia-Djibouti corridor.

Prime Minister Abiy Ahmed made the announcement alongside Djibouti President Ismail Omar Guelleh and Dangote Group President Aliko Dangote during a ceremony marking the launch of the petroleum infrastructure project.

The project will be developed through a partnership between Ethiopian Investment Holdings - Africa's largest sovereign wealth fund, dedicated to advancing national development through the strategic management of public asset and the Dangote Group.

 

The initiative will establish a 120-kilometre refined petroleum products pipeline linking Damerjog in Djibouti with Dewele in Ethiopia, supported by more than one million cubic meters of combined storage capacity at both ends.

In his remarks, PM Abiy said the geographic connection between the two countries has created a shared corridor linking Djibouti with Ethiopia’s vast market and connecting Ethiopia to global trade, but stressed that the corridor’s full potential must now be converted into shared prosperity.

The Prime Minister pointed to delays, inadequate storage and inefficient fuel transportation as major obstacles that increase costs for households, businesses and producers.

He said fuel travelling to Addis Ababa currently spends about five days on trucks, while the new pipeline is expected to cut that journey to approximately one day.

The improved system will also allow Ethiopia to build larger fuel reserves and strengthen its ability to maintain supplies during periods of global uncertainty.

Abiy also highlighted the strategic importance of the project amid disruptions affecting international shipping routes.  

 

For Ethiopia and Djibouti, whose economies are closely connected to Red Sea trade, he said stronger infrastructure and supply-chain resilience are increasingly important.

Abiy said the benefits will extend across Ethiopia's economy, supporting manufacturing, transportation, agriculture and urban centers.

Djibouti, meanwhile, is expected to see increased transit activity, greater utilization of its energy infrastructure and further development of its role as a regional logistics hub.

He emphasized that the pipeline should not operate in isolation.

The highway, railway, Mojo Modern Logistics Centre, storage facilities and pipeline need to function as an interconnected logistics network.

Greater integration, he said, would shorten transportation times, facilitate trade and improve the competitiveness of the wider region.

The partnership combines the strategic location and port infrastructure of Djibouti, Ethiopia's large and growing market and investment mobilization capacity through Ethiopian Investment Holdings, and the Dangote Group's capital and industrial expertise.

During the occasion, the Premier praised the Dangote Group for bringing capital and industrial experience to the project.

 

Addressing Aliko Dangote, PM Abiy said African businesses can match ambition with action and compete globally, describing the investment as “African capital building African infrastructure for African roads.”

He said the project must deliver visible results, including faster fuel deliveries, stronger reserves, lower costs and greater competitiveness for businesses.

Prime Minister Abiy also thanked President Guelleh for Djibouti's longstanding partnership with Ethiopia and Dangote for his confidence in Ethiopia and Africa's economic future.

The investment marks a significant step toward strengthening East Africa's energy resilience, trade connectivity and regional economic integration, while reinforcing the strategic economic relationship between Ethiopia and Djibouti.