Dangote breaks ground on $16 billion Kenya refinery

FTZ News: Nigerian billionaire Aliko Dangote and President William Ruto were set to break ground Wednesday on a $16 billion oil refinery at Lamu, Kenya’s second deep-water port.

The plant is designed for 700,000 barrels a day, the same scale as Dangote’s refinery in Nigeria. Reuters, in a dispatch by Edwin Okoth from Lamu and Duncan Miriri from Nairobi, said the company wants to repeat that project as Kenya and Uganda move toward producing their own crude. The target date is 2030. The pitch is lower pump prices and less hard currency spent on imported fuel.

Dangote spoke to reporters in Nairobi on Tuesday.

“When you look at East Africa, not only East Africa, most of all the 54 countries in Africa, they import petroleum products,” he said. “What we are trying to do is to make sure that we become self-sufficient in whatever we consume.”

East African governments have been offered a combined 30 percent of the project.

David Ndii, President Ruto’s chief economic adviser, estimated yearly demand for petroleum products in the region at 20 million to 30 million metric tons. A financier who works on African refineries told Reuters that meeting that demand would take more than 1 million barrels a day of capacity.

Fuel costs in the region rose after the U.S.-Israeli war with Iran. Kenya had deadly protests over pump prices.

The Nigerian refinery shifted that country from a large fuel importer toward exports. Reuters said the Kenyan plant is not assured of the same result. Local crude and weaker energy infrastructure remain problems. Officials have talked about petrochemicals, bitumen and more than 50,000 jobs.

Environmental groups and conservationists say the site sits too close to Lamu Old Town, a World Heritage property with fragile marine water. The High Court ordered parts of the ground preserved until it hears a case filed by residents. Construction could be delayed. Dangote blamed traders who would lose if refined product were made next door.

Reuters first laid out the crude-supply doubts on Sept. 9. Monicah Mwangi photographed excavators at Lamu the day before the groundbreaking./.


photo by: Presidential Communication Service (PCS)