Dangote Sets September 30 Groundbreaking for $16 Billion Kenya Refinery

Aliko Dangote has confirmed September 30, 2026 as the groundbreaking date for his planned $16 billion oil refinery in Lamu, Kenya, bringing the project closer to construction after earlier plans pointed to October.
Dangote confirmed the date while speaking to investors and analysts during a visit to Botswana. “We are launching it on September 30,” he said, according to Reuters.
The refinery will have a planned processing capacity of 700,000 barrels of crude oil per day, making it the largest refinery in East Africa and the second-largest on the continent after Dangote's Lagos refinery in Nigeria.
The facility is expected to supply refined petroleum products to Kenya and neighbouring markets, including Uganda, Tanzania, South Sudan and the Democratic Republic of Congo.

Refinery Targets East African Fuel Markets

The Lamu refinery is intended to serve Kenya and surrounding markets that depend heavily on imported refined petroleum products.
Its location on Kenya's Indian Ocean coast would provide access to regional trade routes and could support the distribution of refined fuels into inland markets.
The project also forms part of Kenya's plans to develop Lamu as a larger industrial and energy hub.

Project Cost Revised to $16 Billion

The estimated cost of the refinery has been reduced to approximately $16 billion from an earlier projection of $17 billion.
Dangote has attributed the lower cost to efficiencies gained from the construction of his Lagos refinery, faster construction timelines and lower financing costs.
Around 70% of the project is expected to be financed through debt. This would amount to approximately KSh1.45 trillion, or $11.2 billion.
The remaining 30%, estimated at KSh621 billion or about $4.8 billion, would come from shareholders, including Dangote.
The proposed financing structure means debt would provide the majority of the capital required to build the refinery, with shareholders funding the remaining portion.

Kenya, Ethiopia and Rwanda Offered 30% Stake

Dangote has offered Kenya, Ethiopia and Rwanda a combined 30% equity stake in the refinery, valued at approximately $1.5 billion.
Kenya's proposed share is 10%, worth about $500 million. David Ndii, economic adviser to President William Ruto, disclosed the proposed ownership structure at the Mwango Capital Markets Forum in Nairobi.
Ndii said the combined value of the three countries' proposed holdings is approximately KSh194.2 billion, or $1.5 billion.
The proposed equity participation would give the three governments a direct ownership position in a refinery intended to serve the wider East African market.
Kenya's selection as the location was confirmed in July after months of speculation that Tanzania's Tanga could host the project.
The Kenyan government has presented the Lamu refinery as part of a broader strategy to strengthen regional energy security and support industrial development in the coastal county.

Regional Crude Supply Will Be Critical

The refinery's planned capacity of 700,000 barrels per day will require substantial crude oil supplies.
Ndii has estimated that countries in the region could collectively supply more than 600,000 barrels of crude oil per day to the facility.
South Sudan could contribute about 350,000 barrels per day, while Uganda could provide 250,000 barrels and Kenya about 120,000 barrels.
These figures are estimates and do not represent confirmed supply commitments from the three countries.
The availability of sufficient crude and the infrastructure required to transport it to Lamu will therefore be important to the refinery's operating model.

Lamu Industrial Complex Planned

The refinery is expected to form part of a wider industrial development in Lamu.
Kenya is planning additional infrastructure around the project, including a proposed 1,000-megawatt power plant and a special economic zone.
President William Ruto has said the wider development could create about 60,000 jobs and provide a significant boost to Lamu County's economy.
The September 30 groundbreaking will therefore mark an important step for a project that combines oil refining, power generation and industrial development.
Its progress will depend on the completion of financing arrangements, securing reliable crude supplies and delivering the infrastructure required to support the refinery's planned operations.