Nigeria's Dangote breaks ground on $16 billion East African oil refinery in Kenya - Reuters

Nigeria's Dangote breaks ground on $16 billion East African oil refinery in Kenya | Reuters

Skip to main content

Exclusive news, data and analytics for financial market professionalsLearn more aboutRefinitiv

* World

Browse World

+ Africa
+ Americas
+ Asia Pacific
+ China
+ Europe
+ India
+ Iran War
+ Israel and Hamas at War

- Japan
- Middle East
- Reuters/Ipsos Polls
- Ukraine and Russia at War
- United Kingdom
- United States
- U.S. Midterm Elections
- Reuters NEXT
* Business

Browse Business

+ Aerospace & Defense
+ Autos & Transportation
+ Davos
+ Energy
+ Environment
+ Finance
+ Healthcare & Pharmaceuticals

- Media & Telecom
- Retail & Consumer
- Future of Health
- Future of Money
- Take Five
- World at Work
* Markets

Browse Markets

+ On the Money
+ Asian Markets
+ Carbon Markets
+ Commodities
+ Currencies
+ Deals
+ Emerging Markets
+ ETFs

- European Markets
- Funds
- Econ World
- Global Market Data
- Rates & Bonds
- Stocks
- U.S. Markets
- Wealth
* Sustainability

Browse Sustainability

+ Boards, Policy & Regulation
+ Climate & Energy
+ Land Use & Biodiversity
+ Society & Equity

- Sustainable Finance & Reporting
- The Switch
- Reuters Impact
- COP31
* Legal

Browse Legal

+ Government
+ Legal Industry
+ Litigation
+ Transactional
+ US Supreme Court
* Commentary

Browse Commentary

+ Breakingviews
+ ROI: Reuters Open Interest
* Technology

+ Artificial Intelligence
+ Cybersecurity
+ Space
+ Disrupted

Investigations

Sports

+ World Cup
+ Athletics
+ Baseball
+ Basketball
+ Cricket
+ Cycling
+ Formula 1
+ Golf
+ NFL
+ NHL
+ Soccer
+ Tennis

Science

Lifestyle

+ Culture Current

City Memo

Graphics

+ Chart of the Week

Pictures

Wider Image

Podcasts

+ Reuters World News
+ Reuters Morning Bid
+ Reuters Econ World
+ On Assignment
+ Viewsroom
+ The Big View

Live

Fact Check

Video

Media Center

+ Announcements
+ Awards
+ Inside the Newsroom
+ People News

Sponsored Content

+ Reuters Plus
+ Press Releases

My NewsSign InSubscribe

Nigeria's Dangote breaks ground on $16 billion East African oil refinery in Kenya

By Edwin Okoth and Duncan Miriri

September 29, 202610:01 PM CDTUpdated 50 mins ago

*
*
*

*
*
*
*
*

!Groundbreaking ceremony for the construction of East African oil refinery in Lamu

Item 1 of 4 Kenya's President William Ruto and Vice President Kithure Kindiki stand amid heavy machinery, on the day of a groundbreaking ceremony for the construction of an East African oil refinery in Lamu, Kenya, September 30, 2026. REUTERS/Monicah Mwangi

**\[1/4]**Kenya's President William Ruto and Vice President Kithure Kindiki stand amid heavy machinery, on the day of a groundbreaking ceremony for the construction of an East African oil refinery in Lamu, Kenya, September 30, 2026. REUTERS/Monicah Mwangi Purchase Licensing Rights, opens new tab

* Summary
* Companies

* Dangote and Kenya aim to replicate success of Nigerian refinery
* East African governments have been offered a combined 30% stake
* Doubts remain over crude oil supply and energy infrastructure

LAMU, Kenya, Sept 30 (Reuters) - Construction begins on Wednesday of a $16 billion Kenyan oil refinery aimed at lowering East Africa's fuel ‌costs and saving the region hard currency used to import refined products.

Aliko Dangote and Kenyan President William Ruto will break ground on the site, where the billionaire wants to replicate his group's 700,000-barrel-per-day Nigerian refinery as countries including Kenya and Uganda look to start producing crude oil.

The Reuters Power Up newsletter by columnist Ron Bousso provides everything you need to know about the global energy industry. Sign up here.

Dangote, Africa's richest man, ​has offered regional governments a combined 30% stake in the Kenyan refinery, which is due to be completed in ​2030. A $450 million engineering contract has been awarded to Engineers India Limited (ENGI.NS), opens new tab.

"When you look at East Africa, ⁠not only East Africa, most of all the 54 countries in Africa, they import petroleum products," Dangote told reporters in Nairobi, ​adding that the goal was to make the region "self-sufficient".

CONSTRUCTION EQUIPMENT SPURS HOPE

Dangote joined Ruto, Ethiopia's Prime Minister Abiy Ahmed, Uganda's President ​Yoweri Museveni and Togo's President Jean-Lucien Savi de Tové for the ceremony at the port of Lamu, ringed by a row of excavators and earth movers.

"I am very hopeful when I see these machines lined up here because I know I have a chance to work and change my life ​from my menial jobs now to become a machine operator which is what I'm trained to do," said local resident Evans ​Hundo.

Situated along Kenya's northern shoreline, Lamu Port, which welcomed its first cargo ships in 2021, is central to Kenya's bid to open a new ‌transport corridor ⁠linking its vast northern region and neighbouring countries to the sea.

The refinery is expected to boost that initiative, while addressing annual demand for petroleum products in the region which Ruto's chief economic adviser, David Ndii, said is estimated at 20 million to 30 million metric tons.

Meeting that demand would require capacity of more than 1 million bpd, said a financier involved in African refineries.

East Africa ​has been hit hard by surging ​fuel prices resulting from the ⁠Iran war, sparking deadly protests in countries such as Kenya over rising pump prices.

TESTING NIGERIAN MODEL

Oil industry analysts say it is not a given that the new Kenyan project can replicate the Nigerian model, ​which turned the West African country from a major fuel importer into a growing exporter.

Officials have ​said the facility ⁠is also expected to spur industries such as petrochemicals and bitumen production and create more than 50,000 jobs.

But doubts remain over local crude supplies and the region's energy infrastructure, while the project also faces opposition from environmental campaigners, who fear it could affect Lamu Old ⁠Town, a ​World Heritage site hosting fragile marine life.

Kenya's High Court ordered the preservation of ​parts of the site pending a hearing in a case brought by local residents.

Dangote attributed the opposition to traders and businesses whose profit models would be threatened ​by the refinery.

Updates with comment by resident, foreign leaders and engineering contract

Reporting by Edwin Okoth in Lamu and Duncan Miriri in Nairobi; Editing by Karin Strohecker, David Goodman and Alexander Smith

Our Standards: The Thomson Reuters Trust Principles., opens new tab

* Suggested Topics:
* Emerging Markets
* Grid & Infrastructure

*
*
*
*
*

Purchase Licensing Rights

Read Next

* 28 mins agoBusinesscategory

Energy developer Rezolv secures €561 million loan for EU's largest solar park in Romania

* 24 mins ago

State Bank of India buys nearly 40% of Reliance's $1.35 billion debt sale

* 42 mins ago

India has yet to decide on dropping pre-shipment inspections of scrap metal imports

* 1 hour ago

India's SAIL flies in Mongolian coking coal as it seeks new supplies, sources say

* 1 hour ago

Czech and Italian government leaders table package to ease carbon, energy prices

* 1 hour agoCommentarycategory

COMMENTARY

Morning Bid: October doubts

Business

* Analysts raise 2026 oil forecasts on prolonged Gulf disruption

Energycategory · September 30, 2026 · 6:48 AM CDT · 11 mins ago

Analysts have raised their 2026 oil price forecasts with benchmark Brent crude expected to ​average nearly $90 a barrel as disruption to Gulf exports offsets concerns over dema