Published On 9/7/2026
The Nigerian Dangote Group chose the port of Lamu on the Kenyan coast as a site to build a giant oil refinery with a capacity of 700,000 barrels per day, at a cost that could reach $17 billion, in a move that ends months of ambiguity over whether the project will be held in Kenya or Tanzania. Devakumar Edwin, the group’s vice president for oil and gas affairs, said that the site has been selected and that soil investigations are underway and design and engineering work has already begun, stressing that Kenya “was the choice from the beginning,” according to what was reported by the “Billionaires Africa” website. There were conflicting estimates regarding the completion period, with Reuters reporting that construction would take about 3 years, while Bloomberg estimated it at about 5 years. President William Ruto had said that construction work would begin this year.
The project comes within a broader expansion program, as the group announced its intention to pump additional investments worth $46 billion between 2026 and 2028 in the refining, cement and fertilizer sectors, in an effort to raise its revenues to $100 billion by 2030, according to what was reported by the Nigerian Tribune newspaper. The group intends to finance the Lamu project from internal liquidity, bond issues, and proceeds from an initial public offering it is preparing for its Nigerian refinery, without resorting to large external borrowing.
From Tanga to Lamu
The project’s route to Kenya was not direct. Last April, Nigerian businessman Aliko Dangote appeared alongside Kenyan President William Ruto and his Ugandan counterpart, Yoweri Museveni, and presented a plan to establish the refinery in the port of Tanga on the Tanzanian coast. However, Tanzanian President Samia Hassan did not respond to the proposal, so the project moved north to Lamu, according to the “Billionaires Africa” website, which added that Dangote met the Tanzanian president weeks ago to explain the decision and called Her country to participate in the project.
Ruto announced that the governments of the region would participate in the investment, and Kenya allocated 21.5 billion shillings (about 167 million dollars) as start-up capital. He also assigned his deputy, Kitthuri Kindiki, to head the government committee supervising the project.
The Lamu refinery, once completed, will be the largest oil processing facility in East Africa, and Dangote’s largest refining investment outside Nigeria, and is designed to serve Kenya, Uganda, Tanzania, South Sudan and neighboring markets, in a region that currently imports almost all of its refined fuel. The project restores Kenya’s ability to lose more than a decade ago, when the old Mombasa refinery stopped processing crude oil and turned into a storage facility, making the country completely dependent on imported derivatives. The selection of Lamu, the new port within the LAPSSET corridor linking Kenya, Ethiopia and South Sudan, poses a logistical competition with the port of Mombasa, through which today imported fuel heading to Uganda, Rwanda, South Sudan, Burundi and eastern Democratic Congo passes, according to the Kenyan website “Tuko”.
Lagos record: success and warning
Dangote’s eastern ambition is based on the record of his refinery in the Lekki area near Lagos, which is the largest single-line refining facility in the world with a capacity of 650,000 barrels per day, and is being expanded to 1.4 million barrels by 2028. Last June, the refinery surpassed the United States of America to become the largest foreign supplier of jet fuel to Europe, after it shipped about 466,000 tons worth approximately $553 million, almost double May shipments, according to S&P data. Global.
However, the Nigerian experience also carries a warning about the cost. The Lagos refinery, which was estimated at about $9 billion when it was launched in 2013, will have a final cost exceeding $20 billion when it starts operating in 2024. No concrete has been poured in Lamu yet, as the company describes the ongoing work as preparatory, and a specific date for laying the foundation stone has not yet been announced.
