₦airaland Forum

Dare Olawin and Damilola Aina


Dangote Industries Limited has commenced preliminary works on its proposed $17bn, 700,000-barrels-per-day refinery in Kenya, marking the first major step towards what is expected to become East Africa’s largest refining project.

The company said the project has advanced beyond the planning stage, with the site already selected, soil tests ongoing and engineering and design work underway ahead of construction.

According to Reuters, the refinery, which will be located on Lamu Island off the Kenyan coast, is expected to take about three years to complete and will supply refined petroleum products to Kenya and neighbouring countries, reducing East Africa’s dependence on imported fuels.

The development comes as Bloomberg reported on Tuesday that President of the Dangote Group, Aliko Dangote, plans to build the refinery at an estimated cost of up to $17bn as part of efforts to expand his refining empire into East Africa.

Citing a spokesman for Dangote Industries Ltd., Bloomberg reported that the proposed refinery would replicate the company’s refinery in Lagos and process about 700,000 barrels of crude oil per day when completed.

The report read, “A new mega-refinery to be built at the Kenyan coast by Africa’s richest person will cost as much as $17bn, a spokesman for Dangote Industries Ltd. has confirmed.

“Billionaire Aliko Dangote personally pledged to the leaders of Kenya and Uganda that he would set up a replica of his 700,000-barrel-a-day refinery outside Lagos in East Africa. The refinery would take about five years to build.”

According to the report, Dangote personally assured the Presidents of Kenya and Uganda that he would establish the refinery in East Africa. The report recalled that Kenyan President William Ruto announced in May that Dangote would commence construction of the refinery this year.

Speaking to Reuters, Dangote Industries’ Vice President for Oil and Gas, Devakumar Edwin, said the company had made significant progress on the project. “The site has been selected, soil tests are underway, and design and engineering work has commenced. Kenya was the choice from the beginning,” he told Reuters.

According to Bloomberg, Dangote said the coastal town of Lamu in southeastern Kenya was selected as the preferred location “for commercial and technical reasons,” although he did not provide further details.

The report added that Tanzania had initially been considered as a possible location for the refinery before Kenya emerged as the preferred destination.

The project represents Dangote Group’s biggest refining investment outside Nigeria and forms part of the company’s ambition to expand refining capacity across Africa following the commencement of operations at its 650,000-barrels-per-day refinery in Lagos.

Devakumar disclosed that the refinery would be financed through a combination of internally generated cash, bonds, and proceeds from the company’s planned initial public offering.

He, however, declined to state the exact cost of the project, saying it would be comparable to that of the Lagos refinery. The Lagos refinery, built by Aliko Dangote, eventually cost more than $20bn before commencing operations in 2024.

Reuters reported that the project was initially estimated at about $9bn in 2013, but costs escalated following the relocation of the site, engineering challenges, currency weakness, the COVID-19 pandemic and global inflation.

The investment comes as Dangote is simultaneously pursuing another ambitious expansion programme in Nigeria, where the capacity of the Lagos refinery is being doubled from 700,000 barrels per day to 1.4 million barrels per day by 2028. Once completed, the Nigerian complex is expected to become one of the world’s largest refining facilities.

Dangote Industries Limited has also unveiled plans to increase its combined refining capacity to 2.1 million barrels per day across Nigeria and Kenya as part of its long-term strategy to expand its footprint across Africa.

Edwin disclosed this during a recent visit by a delegation from the Republic of the Congo’s national oil company, Société Nationale des Pétroles du Congo, to the Dangote Petroleum Refinery in Lagos.

He said the expansion would raise the group’s total refining capacity to 2.1 million barrels per day, comprising 1.4 million barrels per day in Nigeria and the planned 700,000-barrels-per-day refining complex in Kenya to serve East African markets.

He also disclosed plans by the group to invest an additional $46bn between 2026 and 2028 across its refining, cement and fertiliser businesses as part of its drive to accelerate industrialisation across Africa.

The proposed Kenyan refinery reflects a growing recognition across Africa that local refining has become increasingly critical to energy security, foreign exchange conservation, and industrial development.

For decades, despite producing millions of barrels of crude oil daily, Africa has remained heavily dependent on imported refined petroleum products because of inadequate refining capacity.

Data show that while Africa contributes about seven per cent of global crude oil production, refining capacity across the continent declined by roughly one-third over the past two decades as ageing refineries suffered years of underinvestment, operational inefficiencies and poor maintenance.

The commissioning of the Dangote refinery has begun to reverse that trend. The refinery reached full operational capacity shortly before the recent Middle East tensions involving Iran, helping Nigeria significantly reduce its dependence on imported petrol and other refined products while improving domestic fuel availability.

Its success has renewed interest among African governments and private investors seeking to replicate the model in other parts of the continent. Beyond Kenya, several countries are now pursuing similar projects to strengthen their domestic refining industries.

In Mozambique, Nigerian businessman Benedict Peters has indicated interest in developing a proposed 200,000-barrel-per-day refinery, while Uganda is advancing plans to construct a 60,000-barrel-per-day refinery to meet domestic demand and supply neighbouring markets in Kenya and Tanzania.

According to the African Petroleum Producers’ Organisation, Africa currently exports about three-quarters of the crude oil it produces while importing approximately 70 per cent of the refined petroleum products consumed across the continent.

This imbalance has continued to expose African economies to volatile international fuel prices, high transportation costs, and foreign exchange pressures.

The proposed Kenyan refinery is therefore expected not only to strengthen East Africa’s energy security but also to deepen regional trade in refined petroleum products, reduce import dependence and stimulate industrialisation across the region.

Africa possesses abundant crude oil reserves but has historically lacked sufficient refining infrastructure to process its production locally. As a result, many oil-producing countries export crude oil and import expensive refined petroleum products, exposing their economies to global supply disruptions and price volatility.

The commissioning of the 650,000-barrel-per-day Dangote Petroleum Refinery in Nigeria marked a major shift in the continent’s refining landscape, boosting local fuel production and encouraging governments across Africa to prioritise investments in domestic refining capacity.

The proposed Kenyan refinery represents one of the continent’s most ambitious downstream projects and could significantly reshape fuel supply dynamics in East Africa while advancing the African Union’s broader agenda of industrialisation and regional energy integration.

https://www.google.com/amp/s/punchng.com/dangote-breaks-ground-on-17bn-kenya-refinery/%3famp

this man just keep milking nigerians with the aid of the government

Haaa, this man isn't resting anytime soon.

Noted.

Congratulations to him.

A true $Billoniar with verifiable sources of income.

Just 3 years. Wow, and FG thinks it's rocket science.

Why is the FTC wailing?

After developing Kenya with his Nigeria enabled wealth, one day they would say, "go bek to ya kantri."

Actions speaks louder than words.
No be chchocho like our oga at the top who is also in charge here.
Always doing turn around maintenance to deceive the gullible hopeless blind followers.
Give the same amount to the government here and see how they'll mess the whole project up claiming insufficient funding and inflation.

Nigerians money at work. Don't think it's out of hate. It's reality and we shouldn't lie to ourselves.

Dangote no de taya..
America will sanction him ohh😅😅

Good news, Thank God for giving us Man like Dangote in Nigeria

Never invest or expand anywhere beyond your region as a Nigerian….the yorubas and South Africans have a similar/thesame behavior!

South Africa's Afrophobic (Xenophobic) treatment in my mind. It is risky to invest outside your country now. Who knows tomorrow!

LordIsaac:
After developing Kenya with his Nigeria enabled wealth, one day they would say, "go bek to ya kantri."

At that level you think he wount have done his homework? They would have signed some biding agreement with arbitration in uk or some other jurisdiction. Them try am he will sue, their national assets around the world will be targeted, all their foreign reserves domicilled in banks from new York to Hong Kong etc will be "grabbed".

That's why he is milking Nigerians becoz of his external project funds. Price of crude oil came down all over the world, but we refused to see any significant reduction in Nigeria.

Just 17billion dollars. Not up to a trillion naira

Easylife1234:
Good news, Thank God for giving us Man like Dangote in Nigeria

What have you benefited from dangote?

Monopoly.

Using Kenya government's money.

Because he's from the North.

What other excuses do we have?

A lot of people think I am a government supporter when I say that removing subsidy was the right thing.

In 2010-13 I did some reading. I found out why they wanted us to remove subsidy. But most of you govenrment supproters who praise tinubu for removing subsidy now, when you were opposing it then, plus most of you obi supporters who think that helping the poor means freebies...all of you abuseme.

If subsidy had gone in 1993, NNPC would have been a global company and would have been opeining refineries all over Africa by now.

Well, better late than never, though we know that tinubu was forced to remove subsidy...because no money. And because karma forced him to face the consequences of opposing subsidy removal in 2012.

He is a Professor in Money Making.

did the Kenyan government travel to Nigeria looking for investors ? NO, rather it took Dangote a visionary investor to identify Kenya because they have all it takes ( infrastructure ) in that country to do business, unlike our own leader ( Tinubu ) traveling up and down looking for investors, rather than fixing infrastructure that will attract them.
up Dangote
up Kenya

Attention Aliko Dangote:
Why going to Another Africa 🌍 Country - Kenya.
Hope they Will Not Annex his Company one day- like South Africa -Xenophobia - under Ramaphosa ⁉️
Besides - Why is he not Investing in The:
•Power Sector -🕯️🚨,
•And Steel Sector,
-This is what we Expect this Govt- and the Billionaires Legislatures - the Senators and House Members - to be fighting for !
-So that Real Development and Manufacturing can begin here in Nigeria, because Without Regular and Constant Light •- For No INDUSTRIALIZATION will take Place in Nigeria.
•Dangote - should know that Nobody is Fighting his Number 1 -Africa Billionaire from him,let him be wise and More PATRIOTIC CITIZEN.
He can do better.

Sirleo05:
did the Kenyan government travel to Nigeria looking for investors ? NO, rather it took Dangote a visionary investor to identify Kenya because they have all it takes ( infrastructure ) in that country to do business, unlike our own leader ( Tinubu ) traveling up and down looking for investors, rather than fixing infrastructure that will attract them.
up Dangote
up Kenya

Also, if subsidy had not gone, there would have been no money for Dangote to invest.

Also, KENYA HAS NO FUEL SUBSIDY. That is why investors are going there. NO fuel subsidy. Potential for PROFIT.

And APC and their supporters are using more than that, building roads and arguing with everyone...

If the fg build and control a new refinery and leave the military era refineries, na bad business for them.

And somehow, some of the masses have been led to believe it all makes sense.

This some na osusu wey dem dey share for NA... Everyone go collect their share and argue to the cameras like they're doing anyone good...

Awón òní yéyé

Bluntemperor:
Attention Aliko Dangote:
Why going to Another Africa 🌍 Country - Kenya.
Hope they Will Not Annex his Company one day- like South Africa -Xenophobia - under Ramaphosa ⁉️
Besides - Why is he not Investing in The:
•Power Sector -🕯️🚨,
•And Steel Sector,
-This is what we Expect this Govt- and the Billionaires Legislatures - the Senators and House Members - to be fighting for !
-So that Real Development and Manufacturing can begin here in Nigeria, because Without Regular and Constant Light •- For No INDUSTRIALIZATION will take Place in Nigeria.
•Dangote - should know that Nobody is Fighting his Number 1 -Africa Billionaire from him,let him be wise and More PATRIOTIC CITIZEN.
He can do better.

Power sector: You guys do not want the government to let the power sector set prices. As a result...no profit, therefore no investment. Why should dangote invest in a sector where only 20% of consumers...band A pay cost reflective tarrif? The ones that invested have lost money because the lack of a cost reflective tarrif drove them out.

Steel...CHINA. That is all.

Thewrath:
Never invest or expand anywhere beyond your region as a Nigerian….the the yorubas and South Africans have a similar/thesame behavior!

This comment shows why Nigeria will remain an economic dwarf.
No country becomes a global giant sitting at home.

Basicend:
That's why he is milking Nigerians becoz of his external project funds. Price of crude oil came down all over the world, but we refused to see any significant reduction in Nigeria.

How is the post related to the price of petrol in Nigeria?

Pootle:
this man just keep milking nigerians with the aid of the government

So, the people who are in the market, who do buisness are milking nigerians?

Bros, if you want government to be the one setting prices for everything, ask your senator to pass the appropriate laws, so that dangote and every other business can stop milking nigerians, or keep quiet..

Very nice one from Alhaji