Ruto Says Kenya Ready to Begin Work on Dangote Oil Refinery

Kenya is preparing to break ground on a Sh2.2 trillion oil refinery in Lamu, with President William Ruto saying the project is ready to move into construction.

The refinery is being developed by Nigerian billionaire Aliko Dangote in partnership with the Africa Finance Corporation (AFC). Ruto made the announcement after talks in New York with Dangote Industries President Aliko Dangote and AFC Chief Executive Samaila Zubairu on the sidelines of the United Nations General Assembly.

The discussions focused on financing arrangements and final preparations for the project. The government has presented the refinery as a major investment in energy security, employment and industrial development. Deputy President Kithure Kindiki chaired an inter-ministerial meeting ahead of the planned groundbreaking ceremony on 30 September. He described the project as a “one-in-a-generation investment”.

Government projections indicate that the wider development could create more than 60,000 jobs, including about 30,000 skilled positions. The project is expected to include a petrochemical and industrial complex along Kenya’s coast.

The refinery is designed to process 700,000 barrels of crude oil a day. If completed as planned around 2030, it would be the largest refinery in East Africa and one of the largest on the continent.

Kenya currently spends more than Sh500 billion a year on petroleum imports, making fuel its largest import bill. The government expects a refinery of this scale to retain more of that spending within the domestic economy and reduce exposure to fluctuations in international shipping routes and crude oil prices.

Kindiki said the project would go beyond replacing imported fuel by seeking to establish Kenya as a regional centre for petroleum processing and distribution.

Lamu was selected in part because of its deep-water port and its connection to the Lamu Port-South Sudan-Ethiopia Transport (Lapsset) corridor. The location could support the import of crude oil and the export of refined petroleum products.

The refinery is also expected to support the development of storage facilities, petrochemical industries and manufacturing businesses around the site. This could further strengthen Lamu’s role as a regional trade and logistics centre.

However, securing enough crude oil to operate the refinery will be a major requirement. Kenya does not currently produce crude oil at commercial scale, meaning the facility will depend on supplies from other countries in the region.

Government advisers estimate that East African producers could eventually supply more than 600,000 barrels of crude a day. Their estimates include about 350,000 barrels a day from South Sudan, 250,000 from Uganda and 120,000 from Kenya.