Africa’s wealthiest industrialist, Aliko Dangote, has announced plans to build a $17 billion oil refinery in Kenya, even as the ongoing conflict in the Middle East dramatically inflates profits from his existing 650,000-barrel-per-day Lagos facility, the Financial Times has reported.
In an interview with the British publication, Dangote disclosed that he is now leaning strongly toward establishing the mega-refinery in Mombasa, citing Kenya’s larger economy and deeper port infrastructure as decisive factors.
The proposed facility would match the capacity of his Nigerian plant, processing approximately 650,000 barrels of crude oil per day.
“I’m leaning more towards Mombasa because Mombasa has a much larger, deeper port,” Dangote told the FT, comparing Kenya’s Indian Ocean gateway to Tanga, the Tanzanian site previously under consideration for the project.The billionaire estimated the total investment required for the East African refinery at between $15 billion and $17 billion, a sum that would rank among the largest single industrial investments in the region’s history.
Kenya’s Advantage: Bigger Economy, Deeper PortDangote’s pivot toward Kenya follows a diplomatic spat between Nairobi and Dar es Salaam. Tanzanian President Samia Suluhu Hassan last week complained angrily to her Kenyan counterpart William Ruto that she had not been consulted over an earlier announcement – made in her absence at an infrastructure summit – that the refinery would be built on Tanzania’s coastline.Explaining his preference for Kenya, Dangote was blunt: “Kenyans consume more.
It’s a bigger economy.”He added that crude oil for the refinery could be transported by ship, meaning the facility need not be located near the 1,500-kilometre Uganda-Tanzania crude pipeline that terminates at Tanga. This logistical flexibility gives Mombasa a competitive edge, he argued.”The ball is in the hands of President Ruto.
Whatever President Ruto says is what I’ll do,” the Nigerian industrialist stated, making clear that Kenya’s leader holds the key to unlocking the multibillion-dollar project.Demands on Ruto: Land, Finance, and Protection For the East African refinery to become a reality, Dangote said he would require President Ruto to provide three critical components: land, some East African financing, and – most crucially – protection from what he described as “dumping of cheap fuel” from nations such as Russia and India.”There is no refinery in the world that can survive without that protection,” Dangote insisted. “If we have an agreement, we can start this year.”
The Nigerian billionaire, who built his fortune on cement, sugar, salt, and flour before conquering petroleum refining, has long benefited from similar protective policies in Nigeria, including import restrictions and favourable foreign currency access.
He left the door open for Tanzania as a fallback option, telling the FT he could still build there “if they are able to sort themselves out.”Iran War: ‘Payday’ for Dangote’s Business The timing of the Kenya proposal is notable. The refinery announcement comes as the war involving Iran and the resulting closure of the Strait of Hormuz have created extraordinary profitability for Dangote’s existing operations.
According to a senior Dangote executive who spoke to the FT on condition of anonymity, the crisis has been “payday” for the businessman’s refinery. Fertiliser prices have doubled, the executive said, while margins on jet fuel have widened significantly as European airlines scramble for supplies they can no longer source from the Gulf.Dangote himself confirmed the windfall. “You can see all the other oil companies, their profitability has doubled. So you don’t expect us to do less,” he told the FT.Lagos Refinery Hits Full Capacity at Critical MomentThe timing of Dangote’s success in Nigeria could hardly be more fortuitous.
His 650,000-barrel-per-day plant – the world’s largest single-train refinery – has reached full capacity precisely when other nations are struggling to access petrol, diesel, and jet fuel because most ships cannot transit the Strait of Hormuz.
While countries such as Mauritius, Ethiopia, and Zimbabwe have been forced to ration fuel or dilute it, Nigeria has experienced no queues at petrol stations and has not required emergency measures.
For the first time in decades, Africa’s largest oil producer is not suffering fuel shortages.Dangote has been able to divert jet fuel – at hefty premiums – to European airlines desperate to keep flying. He has also prioritised sales to Ethiopian Airlines, by far Africa’s most important carrier, with a network covering the entire continent.
Beyond petroleum products, his refinery is also a major exporter of urea fertiliser to the rest of Africa, with Nigeria absorbing only a fraction of its 3-million-tonne annual capacity.
Vindication After a Decade of DoubtDangote’s Nigerian refinery was built over 10 years entirely in-house, defying critics who doubted he could ever get it running after decades in which the Nigerian state had repeatedly tried and failed to build meaningful domestic refining capacity.
“Dangote feels vindicated, not only by succeeding technically in getting the refinery to work, but also succeeding commercially,” one Dangote executive said, speaking on condition of anonymity.Ruto’s Praise and Next StepsKenya’s president has been effusive in his praise of the Nigerian industrialist.
Ruto recently said that Dangote has demonstrated that Africans can build their own mega-projects, contrasting the billionaire’s success with Nigeria’s long history of fuel import dependency.
“Nigeria has been a producer of oil for all the years that we know. Yet, when you went to Nigeria, there were queues of people looking for fuel in petrol stations… until one African stepped forward and built a refinery,” Ruto was quoted as saying.Plans to More Than Double Lagos CapacityEven as he eyes expansion into East Africa, Dangote is not standing still in Nigeria.
He told the FT that he is already pressing ahead with plans to more than double the capacity of his Lagos refinery to 1.4 million barrels per day.
Within 30 months, he said, he would have the equivalent of 10 per cent of total US refining capacity and would be running neck and neck with Reliance Industries, the Indian conglomerate owned by Mukesh Ambani, which also refines about 1.4 million barrels per day.
“We’ll be price movers in the market,” Dangote declared.He concluded with a broader appeal for African self-reliance: “It was incumbent on Africans to invest in their own continent.
If we don’t, who else will?”What Happens NextFor the Kenya refinery to advance, President Ruto must now decide whether to offer the land, regional financing arrangements, and import protection that Dangote has demanded.
Should those assurances materialise, construction could begin before the end of 2026, potentially transforming Mombasa into one of Africa’s premier refining hubs and reshaping East Africa’s fuel import dynamics for decades to come.
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