Dubai-based digital infrastructure firm Hodler Investments and China’s GCL Group have announced a strategic partnership to build an off-grid energy infrastructure in Ethiopia.
The collaboration aims to power data centers supporting data-intensive applications like Artificial Intelligence (AI) and blockchain using Ethiopia’s natural gas resources.
The project will leverage GCL’s untapped natural gas resources in Ethiopia, specifically from the Ogaden Basin, to generate power for data centers.
Hodler Investments’ Managing Director Mohamed El Masri, speaking on the sidelines of the ADIPEC 2024 conference in Abu Dhabi, explained that Ethiopia’s growing reputation as a hub for data-driven technology due to affordable renewable energy and regulatory support makes it an attractive location.
“This partnership lets GCL monetize gas that’s currently stranded due to a lack of export infrastructure,” El Masri said, noting that the co-investment structure will be formalised by year-end.
In April 2024, GCL signed two Petroleum Production Sharing Agreements (PPSAs) with the Ethiopian government to develop gas reserves in the Ogaden Basin, estimated to hold 200 billion cubic meters (BCM) of natural gas and 46 million tonnes of oil.
According to the U.S. International Trade Administration, Ethiopia’s affordable energy prices and supportive environment have made it a hotspot for data-heavy technologies, with an estimated 500 MW currently dedicated to Bitcoin mining operations.
El Masri highlighted that GCL’s gas reserves have remained largely untapped due to the absence of infrastructure required to export it as LNG. By establishing mobile power plants and modular data centers housed in standard 40-foot containers, the partnership will initially repurpose this stranded gas to power the data centers, scaling up in increments of 50 MW to a target capacity of 200 MW.
The project is expected to support AI applications with container units of around 200 kW and Bitcoin mining with larger units ranging from 1.2 to 1.5 MW, achieving a hash rate capacity of 14.85 EH/s.
El Masri underscored Ethiopia’s limited power grid capacity, noting it cannot support the projected load for compute-intensive data centers. “Our off-grid, low-capex solution offers faster deployment—getting online in months, not years,” he said, adding that the mobile equipment only requires basic site preparation for installation. This rapid deployment model contrasts with traditional infrastructure projects, which often require long lead times.
To connect the various stakeholders involved in the off-grid solution, Hodler will use its digital energy platform, PermianChain. The platform is designed to optimise wasted energy resources by linking energy suppliers, data center operators, computing end-users, and investors.
In addition to Ethiopia, Hodler Investments is pursuing other off-grid projects in Saudi Arabia, where it is developing a 100 MW solar-powered facility with a secured offtaker, and Canada, where it operates 5 MW and is building an additional 20 MW. El Masri explained that these projects are carefully selected based on pre-arranged offtake agreements, ensuring a viable revenue stream before construction begins.
