Dangote Group plans to finance its proposed 700,000-barrel-per-day oil refinery in Kenya through a combination of internally generated cash, bond issuances, and proceeds from a planned initial public offering (IPO), as the company accelerates its expansion across Africa’s energy sector. According to Reuters, the refinery will be built on Lamu Island and is expected to become East Africa’s largest refining facility, supplying refined petroleum products to Kenya and neighbouring countries while reducing the region’s dependence on imported fuels.
Edwin Devakumar, Vice President for Oil and Gas at Dangote Industries, said the project has advanced beyond the planning stage, with the site selected, soil testing underway, and engineering and design work already in progress. Although the company did not disclose the exact cost of the refinery, Devakumar said the investment would be comparable to the more than $20 billion spent on the 650,000-barrel-per-day Dangote Petroleum Refinery in Lagos, making it the group’s largest refining investment outside Nigeria.
The Kenyan refinery is expected to take up to three years to complete and forms part of Dangote’s broader strategy to expand refining capacity across Africa following the successful launch of its Lagos refinery in 2024. The company had previously considered Tanga, Tanzania, before selecting Kenya, citing superior infrastructure, logistics, and market opportunities. The proposed IPO financing complements Dangote’s wider capital-raising plans, which include preparations for listing interests in its refining business as it seeks to fund future expansion.
For East Africa, the proposed refinery represents one of the region’s most ambitious private energy investments. Analysts say the project could significantly improve regional fuel security, reduce reliance on imported refined petroleum products, create thousands of jobs, and position Kenya as a strategic refining hub serving neighbouring markets. If completed, the facility would further strengthen Dangote’s ambition of building an integrated pan-African energy infrastructure capable of meeting the continent’s growing fuel demand.
