OMM Redaksiyası
Nigerian billionaire Aliko Dangote and Kenyan President William Ruto are expected to break ground on a $16 billion oil refinery in Lamu, on Kenya’s northern coast, according to the BBC.
The facility is projected to process 700,000 barrels of crude oil a day, which would make it East Africa’s largest industrial project by capacity. Construction is due to begin on 1 November, with completion scheduled for 2030.
Some residents have protested ahead of the launch, calling for additional compensation for land used by the project. Dangote rejected the claims, saying the company had taken only the land it needed from the area made available by the government.
“To come and say some people are demonstrating, demonstrating about what?” Dangote told the BBC’s Focus on Africa programme. He said the protests were being driven by local marketers and international players, adding that the refinery would proceed as planned.
Refinery expected to create 60,000 jobs
Dangote said the project would create 60,000 jobs at the height of construction, with wider economic benefits for the surrounding area.
“Are we going to bring robots? Of course, the people will benefit,” he said.
With a planned capacity of 700,000 barrels per day, the Lamu refinery would be the largest infrastructure project in Kenya since independence, surpassing the $5.1 billion Standard Gauge Railway. East Africa currently has no oil refineries.
Kenya defends refinery location
Critics have questioned the decision to build the facility in Kenya, which is not an oil-producing country. Tanzania and Uganda have also been suggested as possible locations, as both countries are moving towards oil exports through the East African Crude Oil Pipeline.
Kenya’s Energy and Petroleum Minister Opiyo Wandayi said the refinery would not have to depend on crude oil produced in the region.
“Refineries get crude oil from the market. And the market is open,” he told the BBC.
Dangote cited Singapore as an example of a country that does not produce oil but hosts major refining operations. “Singapore doesn’t produce a single drop of oil, yet they have a lot of refineries,” he said.
Power plant to support industrial development
The project will include a 1,000-megawatt power plant, intended to supply Dangote’s operations and other industries expected to establish themselves in the area.
Dangote has described reliable electricity as a major constraint on industrialisation across Africa, particularly in mineral-rich countries that continue to export raw materials instead of processing them domestically.
He said he had about $50 billion worth of projects in the pipeline, including plans to develop 10,000 megawatts of power-generation capacity across Africa by 2030. That capacity could be doubled depending on demand.
Kenya’s relatively high fuel prices have raised hopes that additional refining capacity could eventually reduce pump prices. However, the international price of crude oil, the main raw material for fuel, will remain a key factor in determining what consumers pay.
The Lamu refinery is Dangote’s largest proposed investment outside Nigeria. His refinery in Nigeria also has a processing capacity of 700,000 barrels a day, and he plans to double that capacity after floating 4.1 million ordinary shares to raise up to $2.1 billion.
