Nigerian billionaire Aliko Dangote has announced plans to construct a $16 billion oil refinery in Lamu, Kenya, a project he says would become the largest refinery in East Africa and serve markets stretching from the region into Egypt.
Dangote told reporters the facility would have a processing capacity of about 700,000 barrels of crude oil per day, surpassing his own 650,000-barrel-per-day Lagos refinery. The cost estimate has dropped from an earlier $17 billion figure, largely because of the shorter construction timeline and lessons drawn from building the Nigerian plant.
Financing and Government Protection
The financing structure would rely on roughly 70% debt and 30% equity, with lenders covering about $11.2 billion and shareholders putting in around $4.8 billion. Dangote said: "We don't have a problem getting the money."
Dangote said a groundbreaking ceremony is planned for October, with the full project expected to be completed within four years, provided an agreement is reached with the Kenyan government. Central to that agreement is a request for protection against cheap imported petroleum products, particularly from Russia and India. He said: "There is no refinery in the world that can survive without that protection."
Kenyan President William Ruto has indicated support for the project, saying the government intends to take a stake through the National Infrastructure Fund, though the exact investment size has not been disclosed. Ruto said the refinery would reduce Kenya and the region's reliance on imported fuel and lower exposure to shipping disruptions around the Strait of Hormuz.
East Africa as a Regional Supply Hub
The refinery is designed to draw crude oil from Uganda via the East African Crude Oil Pipeline, as well as from Kenya's Turkana oil fields once production ramps up. Additional supplies could arrive by sea through the Port of Lamu. Dangote framed the plant as a regional export hub rather than a facility built only to serve Kenya's domestic market.
East Africa currently imports the bulk of its refined petroleum, leaving governments and consumers vulnerable to Middle Eastern supply shocks and global freight disruptions. The Lamu project marks Dangote's latest investment move in Kenya. His firm, Alterra Capital, has already put money into Kenyan tourism and hospitality businesses, and he previously obtained limestone prospecting rights in Kitui County, though plans for a cement plant in that area were later abandoned.
Forbes estimates Dangote's net worth at $28.5 billion, built across cement, sugar, fertiliser and oil refining. The Kenya announcement comes as he prepares an initial public offering of his Nigerian refinery, a move expected to widen its investor base and give the group more financial flexibility as it pushes deeper into African markets.
Another Billionaire Set to Complete $1 Billion Refinery in Nigeria
Earlier, Legit.ng reported that Nigerians may soon have another operational refinery as billionaire businessman Azibapu Eruani's Azikel Refinery in Yenagoa, Bayelsa state, enters its final stage of construction. The refinery is designed to process 25,000 barrels of crude oil or condensate daily and produce petrol, diesel, aviation fuel, kerosene, liquefied petroleum gas, and other refined products.
The refinery is designed as a full-slate hydro-skimming plant with a capacity to process 25,000 barrels of crude oil or condensate per day. This project, once completed, will add to Nigeria's refining capacity and contribute to the country's goal of reducing fuel imports.
