Prime Highlights
- Dangote Group plans to fund its 700,000-bpd Kenyan refinery through internal cash, bonds and an IPO.
- The Lamu-based refinery would be Dangote’s largest refining investment outside Nigeria.
Key Facts
- Dangote Group is led by Aliko Dangote, ranked Africa’s richest man by Forbes.
- The company’s Lagos refinery cost over $20 billion, more than double its original 2013 estimate.
Background
Nigeria’s Dangote Group plans to finance a proposed 700,000-barrel-per-day oil refinery in Kenya through internal cash flow, bonds and an initial public offering, a senior company executive said.
The refinery, expected to become East Africa’s largest refining project, would take up to three years to build and would supply refined petroleum products to Kenya and neighbouring countries, helping reduce the region’s dependence on imported fuels. It would also support Dangote’s broader ambition to expand fuel-processing capacity across Africa, following the recent start-up of its 650,000-barrel-per-day refinery in Lagos.
Edwin Devakumar, Dangote Industries’ vice president for oil and gas, said the site for the Kenyan refinery had already been selected, with soil tests underway and design and engineering work in progress. He said Kenya had been the preferred choice from the outset. The refinery is planned for the island of Lamu, off Kenya’s coast, and would represent Dangote Group’s largest refining investment outside Nigeria.
Devakumar said the project would be funded through a combination of internally generated cash, bonds and proceeds from a planned public listing. He did not disclose the exact cost but said it would be comparable to that of the Lagos refinery, which was built by Aliko Dangote, ranked Africa’s richest man by Forbes. The Lagos facility had cost more than $20 billion by the time it began operations in 2024, up from an initial 2013 estimate of about $9 billion, due to site relocation, engineering challenges, currency weakness, the pandemic and global inflation.
Dangote had earlier considered Tanzania’s Tanga port before switching its focus to Kenya, citing infrastructure, logistics and market factors.
