The Ethiopian government announces the signing of a joint development agreement with OCP Group to implement a fertilizer project in Dire Dawa.
The deal was reached during a visit by a high-level Ethiopian delegation to Morocco led by Ato Ahmed Shide, Ethiopian Minister of Finance, and accompanied by officials from the Ethiopian Chemical Industry Corporation (CIC), from the Ethiopian Agricultural Businesses Corporation (EABC) and the Ethiopian Minera, Petroleum and Biofuel Corporation (EMPBC).
The visit resulted in an agreement to execute a joint development agreement to establish a joint venture under Ethiopian law for the implementation of a local fertilizer plant in Ethiopia. The agreement is based on the feasibility, the conceptual, environmental and social impact assessment and the hydro and geotechnical studies that have been carried out. According to the agreement, an integrated fertilizer complex will be established in Dire Dawa, using local resources (Ethiopian gas and Moroccan phosphoric acid).
The project will have an initial investment estimated at around USD 2.4 billion during the first phase to develop a 2.5 million ton fertilizer production unit which could reach a production capacity of 3.8. million tonnes per year for a total investment of up to USD 3.7 billion in the second phase.
Ethiopia’s finance ministry says it “strongly believes this project will significantly help meet Ethiopia’s growing demand for fertilizers (mainly urea and NPS+). From 2022, fertilizer imports into Ethiopia will amount to USD 1 billion, and could potentially reach USD 2 billion in 2030”.
“The Ethiopian government affirms its strong support for agriculture and continues to work tirelessly to find tailor-made solutions to the country’s agricultural and industrial challenges,” the Ethiopian statement concluded.
This agreement in Morocco is part of the megaproject signed in November 2016 by King Mohammed VI and the Prime Minister of the Federal Democratic Republic of Ethiopia, Hailé Mariam Dessalegn, in Addis Ababa. This is a project to realize a world-class integrated platform for fertilizer production in Ethiopia.
During this signing ceremony in 2016, Mostafa Terrab, CEO of the OCP group, announced: “This industrial megaproject will require an investment of $ 2.4 billion in its first phase, in order to produce 2.5 million tonnes/year of fertilizer by 2022. This will make Ethiopia self-sufficient in fertilizer, with export potential. An additional investment of 1.3 billion dollars is planned by 2025, to reach a total capacity of 3.8 million tonnes/year of fertilizer, to support the growth of local demand”.