Kenya's $16 Billion Dangote Refinery Project Officially Breaks Ground

en.Wedoany.com Reported - Dangote Group and the Kenyan government held a groundbreaking ceremony for the Dangote East Africa Petroleum Refinery project in Mokowe, Lamu County. The project involves a total investment of approximately $16 billion and is planned to have a crude oil processing capacity of 700,000 barrels per day. Once completed, it will supply gasoline, diesel, and aviation fuel to Kenya and other East African markets, with completion expected around 2030.

The refinery will be developed as part of an integrated industrial park. In addition to the main refining units, a 1,000 MW supporting power plant is planned, along with fertilizer, petrochemical, base oil, and asphalt production facilities. The project is designed to process crude oil from Uganda and other African oil-producing countries, while retaining the capability to process crude oil from multiple sources.Prospect Intel

The project's engineering and technology supply chain has already begun to take shape. Honeywell Technologies will provide engineering services, process licensing, and equipment for the refinery, with the related contract valued at approximately $300 million; Engineers India Limited has secured a project engineering contract worth approximately $450 million. Honeywell had previously participated in the Dangote Nigeria refinery upgrade project.

Kenya's transport authorities disclosed that more than 110 pieces of equipment have arrived at the project site, with approximately 400 more expected to arrive over the next 60 days, as construction preparation and on-site equipment mobilization are already underway. The project was originally planned to be located in Tanga, Tanzania, but was later relocated to Lamu, Kenya, primarily to leverage local deep-water port conditions and LAPSSET corridor infrastructure.

Dangote has also proposed an equity arrangement of up to 30% in total to East African regional governments, with Kenya, Ethiopia, and Rwanda having expressed interest in participating. Once completed, the project will establish a refined petroleum product supply system serving the East African regional market and will be able to export some aviation fuel to European and UK markets.

The project currently faces disputes over land and environmental approvals. The High Court of Kenya has issued an interim ruling maintaining the status quo on part of the project land, with the case involving land ownership, compensation, and environmental impact issues; Dangote has stated that the groundbreaking event will proceed, but some on-site construction activities may be affected by the case's developments.