Nigerian billionaire and industrialist Aliko Dangote has officially confirmed that Kenya will host the Dangote Group’s planned East African mega-refinery, ending months of speculation over whether the landmark project would be built in Kenya or neighboring Tanzania.
The announcement positions Kenya at the heart of one of Africa’s most ambitious energy investments, with the refinery set to be constructed in Lamu and expected to become the largest oil refinery in East Africa.
Dangote Industries Limited’s Vice President for Oil and Gas, Edwin Devakumar, confirmed that the company had settled on Lamu after evaluating several locations across the region.
According to the company, Kenya’s strategic infrastructure, deep-water port, favorable maritime logistics and strong regional market demand gave Lamu a competitive edge over Tanzania’s Tanga port, which had also been under consideration.
Once complete, the refinery will have the capacity to process 700,000 barrels of crude oil per day, enabling it to supply refined petroleum products across Kenya, Uganda, Tanzania and South Sudan.
The project is expected to significantly reduce East Africa’s dependence on imported refined fuel, most of which currently comes from the Middle East.
Dangote revealed that preliminary work on the project has already begun. Engineering design and soil testing have commenced on Lamu Island as the company prepares for full-scale construction. The refinery is expected to take approximately 30 months to complete once construction officially begins.
The facility will become one of the largest industrial developments ever undertaken in Kenya and is expected to transform Lamu into a strategic energy and logistics hub for the region.
Beyond refining crude oil, the project is expected to stimulate investment in supporting infrastructure, including storage facilities, transport networks and port services.
The refinery carries an estimated price tag of between $15 billion and $17 billion, equivalent to approximately Sh2.2 trillion to Sh2.5 trillion.
Dangote plans to finance the project through a combination of internal cash flow generated by the Dangote Group, corporate bond issuances and a planned Initial Public Offering (IPO).
The financing structure mirrors the strategy used to support other major industrial investments undertaken by the conglomerate across Africa.
The Kenyan government has also pledged support for the project, allocating Sh21.5 billion in seed capital to facilitate its development.
The refinery is expected to reshape East Africa’s petroleum supply chain.
Currently, countries across the region rely heavily on imported refined petroleum products, making them vulnerable to global supply disruptions, shipping delays and volatile international fuel prices.
By refining crude oil within the region, the Lamu facility is expected to strengthen energy security while lowering transport costs associated with fuel imports.
The refinery will also support the growing demand for petroleum products driven by expanding economies and increasing industrial activity across East Africa.
The Kenya refinery forms part of Dangote’s broader vision to establish one of Africa’s largest integrated refining networks.
The business magnate already operates the massive Dangote Refinery in Lagos, Nigeria, which has a refining capacity of 650,000 barrels per day.
Combined with the planned Lamu refinery, Dangote aims to build a refining network with a combined capacity of approximately 1.35 million barrels per day, spanning both Africa’s Atlantic and Indian Ocean coastlines.