Africa's richest man will break ground on a $16 billion Kenyan refinery by October

Aliko Dangote will break ground on a refinery at Lamu on the Kenyan coast by October, he told the BBC, putting a firm date on a project that has been discussed for years without one.

The plant is designed to process 700,000 barrels of crude a day, which would make it larger at nameplate than the refinery he built outside Lagos. Lekki was constructed for 650,000 barrels a day and reached that capacity in early 2026.

The cost has come down. Dangote said the Kenyan project is now expected to require about $16 billion, roughly KSh2 trillion, against an earlier estimate of $17 billion. The Nigerian refinery cost around $20 billion.

He attributed the reduction to two things. The Kenyan plant will be built faster, which lowers the financing cost carried during construction, and his company has done it once before.

"It will cost less because this one will be faster, so in terms of financing cost it will be less, and then we are wiser as a company than when we built the one in Nigeria," he said.

Completion is expected in under four years from groundbreaking.

How it will be paid for

Dangote said the project will be funded 30% from equity and 70% from debt.

That structure matters because of what else is happening in October. Dangote Petroleum Refinery has filed with Nigeria's Securities and Exchange Commission for an initial public offering expected to conclude that month, seeking about $5 billion at a valuation he has put near $50 billion. Exchanges in South Africa, Kenya, Egypt, Ghana and Rwanda have held talks with his advisers about letting local investors participate, and Kenyan capital markets could absorb as much as $500 million of the total.

Kenya has indicated it will provide limited seed capital through public funds.

Soil testing and design work have already begun on Lamu Island. Preliminary engineering is continuing while final approvals and site preparation advance.

A regional plant rather than a national one

Dangote was explicit that the refinery is not built for Kenyan demand alone.

"The refinery will not only be for Kenya but East Africa as a whole, so it can serve a lot of countries, including Egypt," he said.

Kenya consumes roughly 100,000 barrels a day. A 700,000 barrel plant is therefore built for export from the outset, supplying Uganda, Tanzania, South Sudan, Ethiopia and markets further north.

The site was chosen for that reason. Lamu has a deep-water port capable of receiving large crude tankers and sits at the head of the LAPSSET corridor, the transport scheme intended to link Kenya's coast to South Sudan and Ethiopia by road, rail and pipeline. Dangote Industries evaluated several East African locations before selecting it.

The company projects around 60,000 jobs across construction, engineering, logistics, manufacturing and energy.

Opposition on the coast

The project has drawn objections in Kenya that have grown louder as it has advanced.

Environmental groups have raised concerns about siting a refinery of that scale on the Lamu archipelago, a UNESCO World Heritage area with mangrove systems and fisheries that support local livelihoods, and about the marine traffic a plant of that size would bring. Mongabay reported activist opposition this week.

Similar objections accompanied the construction of Lamu Port and the coal plant that was eventually cancelled after a successful court challenge.

David Ndii, President William Ruto's economic adviser, has said construction is expected to begin before the end of 2026.

Neither Dangote Industries nor the Kenyan government has published an environmental impact assessment for the refinery, or named the contractors that will build it.