SEATTLE (Oil Monster): Nigerian billionaire Aliko Dangote is reportedly preparing to build a massive oil refinery on Kenya’s coast, in an attempt to replicate the success of his Lagos, Nigeria refinery. The facility will be located within the Lamu Port-South Sudan-Ethiopia Transport (LAPSSET) special economic zone.
The proposed 700,000-barrel-per-day Lamu refinery is expected to be built at an investment of between $15 billion and $16 billion. Dangote Industries plans to hold a groundbreaking ceremony later this month, with completion anticipated by 2030, sources said.
RELATED NEWS:
Dangote expects fuel shortages beyond Iran war as it spurs expansion
Dangote refinery drives increase in petroleum shipments from Nigeria
The refinery is expected to help Kenya reduce its dependence on imported petroleum products. It must be noted that the country spent about $4 billion on fuel imports last year.
Meanwhile, securing enough crude oil continues to remain a challenge. Kenya has yet to develop commercial-scale production, while potential supplies from Uganda and South Sudan face transportation and infrastructure constraints. As a result, the refinery may need to rely heavily on imported crude transported by sea.
Dangote Group intends to fund the refinery through internal cash, bonds and a potential initial public offering. Regional governments, including those of Uganda, Tanzania, Rwanda and South Sudan, could also take equity stakes.
