Oil & Gas

Nigeria’s Dangote Group has offered East African countries a 30% stake in its proposed mega-refinery in Kenya, according to David Ndii, chair of Kenyan President William Ruto’s Council of Economic Advisers. The planned refinery, to be built on Lamu Island, could process up to 700,000 barrels of crude oil per day and is estimated to cost around $17 billion.

The facility is expected to serve Kenya, Uganda, South Sudan, Rwanda, Burundi, and the Democratic Republic of Congo (DRC). With East Africa’s current refined fuel demand estimated at about 450,000 barrels per day, the refinery would have an additional 250,000 bpd of capacity that could supply other African markets.

Lamu’s deep-water natural harbor, with depths of up to 18 meters, would allow large crude tankers carrying as much as 2 million barrels to dock. Kenya could take a 10% stake valued at about $500 million, while the total equity offered to East African nations would be worth approximately $1.5 billion.

The proposed refinery would follow the model of Dangote’s 650,000-bpd refinery in Nigeria, which can meet the country’s entire fuel demand. Dangote has also begun work on a second processing unit at the Nigerian complex, expected to add another 700,000 bpd of capacity and strengthen the group’s position in global fuel markets.