President and Chief Executive Officer of Dangote Group, Aliko Dangote, has announced plans to construct a 700,000-barrel-per-day (bpd) refinery in Kenya as part of efforts to reduce Africa’s dependence on imported refined petroleum products.

According to Dangote, the proposed refinery has reached an advanced stage, with a groundbreaking ceremony expected by October 2026, after which construction is expected to begin.

“The plans have actually gone very far with Kenya. By latest October, we will be doing groundbreaking. Once we break ground, we will start the construction very soon,” he told the BBC in an interview.

Dangote to build $16 billion East African refinery in Kenya by October

The refinery is expected to serve Kenya and several other countries across East Africa, with Dangote describing the project as the “East African Refinery” because of its intended regional reach.

“That is why we are calling it the East African Refinery. It concerns a lot of countries up to even Egypt,” he said.

The planned refinery is estimated to cost between $15.5 billion and $16 billion, lower than the initial projection of $17 billion.

Dangote attributed the reduction to experience gained from constructing his refinery in Lagos, Nigeria, as well as improved efficiency in project execution.

He said the Kenyan facility is expected to be completed within four years after construction begins.

Financing for the project is expected to follow a 30:70 equity-to-debt structure, meaning 30% of the investment will be financed through equity, while 70% will come from debt.

The proposed refinery forms part of Dangote’s broader strategy to expand refining capacity across Africa and reduce the continent’s reliance on imported petroleum products.

Although Africa is a major producer of crude oil, many countries continue to depend on imported refined fuels due to inadequate domestic refining capacity.

Dangote said the planned facility would help address this imbalance by increasing the volume of crude that can be processed within the continent.

The refinery is also expected to strengthen energy security in East Africa by supplying refined petroleum products to Kenya and other regional markets.

The project follows the development of the 650,000bpd Dangote Refinery in Lagos, which has significantly expanded Nigeria’s refining capacity and strengthened the group’s position in Africa’s downstream petroleum sector.

The planned Kenyan investment could further extend Dangote Group’s footprint into East Africa while supporting regional trade in refined petroleum products.

Dangote said the broader objective is to help African countries move away from exporting crude oil while importing finished petroleum products.

The planned investment could therefore support greater local value addition, improve energy security and reduce the vulnerability of African economies to fluctuations in international refined fuel prices.

DR/MA