Dangote Group is planning a major expansion into East Africa through the development of a proposed USD 17 billion oil refinery in Kenya, a project that could reshape the region’s energy landscape and reduce dependence on imported petroleum products.
The refinery is planned for Lamu Island on Kenya’s Indian Ocean coast and is expected to have a processing capacity of 700,000 barrels of crude oil per day. Once completed, it would become the largest refinery in East Africa and the group’s largest refining investment outside Nigeria.
The project builds on the success of the Dangote Refinery in Lagos, Nigeria, which commenced operations in 2024. The Nigerian facility, currently the world’s largest single train refinery, has a processing capacity of 650,000 barrels per day and is expected to expand further in the coming years.
Preparatory work for the Kenyan refinery is already underway, with site selection completed, soil testing in progress and engineering activities initiated. Construction is expected to take between three and five years.
Reports indicate that Dangote Group plans to finance the project through a combination of internally generated funds, bond issuances and proceeds from a planned initial public offering. The investment forms part of the conglomerate’s broader strategy to expand refining capacity across Africa and strengthen the continent’s energy infrastructure.
The refinery is expected to serve Kenya and neighboring countries by supplying refined petroleum products to regional markets. Industry observers note that the project could enhance fuel security, reduce reliance on imported refined products and support industrial growth across East Africa.
Kenya was selected after the company evaluated alternative locations in the region, including Tanzania. Factors such as infrastructure availability, logistics connectivity and commercial viability reportedly influenced the decision.
Analysts view the proposal as one of the most significant industrial investments currently planned in East Africa. They point to Dangote Group’s successful delivery and operation of its Nigerian refinery as a key factor supporting investor confidence in the Kenyan project.
Beyond the energy sector, the refinery is expected to generate thousands of direct and indirect employment opportunities, attract additional domestic and foreign investment, and strengthen regional trade links. It could also support deeper economic integration under the African Continental Free Trade Area by expanding regional value chains and increasing the availability of refined petroleum products across East Africa.
While the project is expected to benefit from strong regional demand and the sponsor’s track record, experts note that its success will ultimately depend on securing financing, maintaining a predictable regulatory environment, ensuring reliable crude oil supply and achieving commercial viability. If implemented as planned, the refinery could become one of the largest industrial developments in East Africa and a significant milestone in Africa’s efforts to expand domestic energy production and processing capacity.
Source: Forbes Africa
