Dangote confirms $17 billion mega refinery in Kenya, to rival Lagos plant
By Aboki Forex —
Dangote Group has confirmed plans to build a new $17 billion oil refinery on Kenya’s Lamu Island. The facility will process 700,000 barrels per day and is expected to become the largest refinery in East Africa.
The planned refinery will be a clone of the Dangote refinery in Lagos and will be funded through internally generated funds, bond sales, and proceeds from an impending IPO. Edwin Devakumar, the vice president of Oil and Gas for Dangote Industries, told Reuters that preliminary work has already started.
Project details and location
The refinery, to be located on Kenya’s Lamu Island, was originally planned for Tanzania but was later moved to Kenya after consultation with regional leaders. Devakumar stated: "Preliminary work has already started. The site has been selected, soil tests are under way, and design and engineering work has commenced. Kenya was the choice from the beginning."
The project represents Dangote Group's single largest investment outside Nigeria. The Lagos refinery, which cost over $20 billion, officially commenced operations and has been key to ending fuel scarcity and reducing imports in Nigeria.
Funding and investment timeline
Devakumar said the new refining venture will be funded through internal generation, bond sales, and the proceeds of an impending IPO, which he said could be announced as early as October, giving Nigerians an investment opportunity. He refused to disclose a precise figure for the investment but stated it will be in line with the cost of the Dangote refinery in Lagos, which eventually exceeded $20 billion, according to Punch reports.
Wider expansion plans
The Kenya project is part of a wider drive to boost Africa's refining output. Dangote Group also plans to raise the Lagos refinery's capacity from 650,000 bpd to 1.4 million bpd by 2028. Africa currently exports roughly three-quarters of its crude oil production while importing approximately 70% of its refined petroleum products, according to estimates from the African Petroleum Producers' Organisation.
A refinery of this scale in East Africa would meaningfully reduce the region's dependence on imported fuel and position Kenya as a central hub for petroleum supply across neighbouring countries.
Earlier, Legit.ng reported that Dangote Petroleum Refinery has opened the sale of petrol to all licensed marketers, ending its previous consortium marketing arrangement. The refinery said all qualified marketers can now purchase products directly from its loading gantry, widening access to locally refined petrol and allowing more participants to source fuel without going through intermediary arrangements.
What this means for Nigeria: The expansion signals Dangote's growing dominance in Africa's refining sector and could pressure domestic fuel prices as more refining capacity comes online. For the naira, reduced reliance on imported fuel across the continent may ease demand for foreign exchange over time.