Aliko Dangote is putting $16 billion behind East Africa’s push to reduce its dependence on imported fuel, with a new refinery in Kenya that could become one of the region’s biggest industrial projects.

The billionaire is expected to break ground with Kenyan President William Ruto on a refinery at Lamu Port, targeting completion in 2030. The project is designed to supply petroleum products to Kenya and neighbouring markets while keeping more of the region’s foreign currency at home.

Dangote has offered governments across the region a combined 30% stake in the refinery, signaling an effort to build the facility around a wider East African market rather than Kenya’s domestic demand alone.

Engineers India Limited has won a $450 million engineering contract for the project, providing an early indication of the scale of spending required before the refinery begins production.

A market measured in millions of tons

The commercial case for the refinery rests on a large and growing regional fuel market. East African countries collectively consume an estimated 20 million to 30 million metric tons of petroleum products each year, according to David Ndii, chief economic adviser to President Ruto.

A financier involved in African refinery projects estimates that satisfying that demand would require more than 1 million barrels per day of refining capacity.

That gap has left countries across the region dependent on imported refined products even as Kenya, Uganda and other economies pursue their own crude-oil production ambitions.

Dangote said the project is part of a broader effort to reduce Africa’s dependence on imported petroleum products, arguing that most of the continent’s 54 countries still rely on imports to meet fuel needs.

The timing also puts the project in the middle of renewed pressure over fuel costs. East African consumers have faced sharp increases in pump prices, contributing to protests in Kenya and elsewhere.

Lamu gives project a regional role

The refinery will be located at Lamu, on Kenya’s northern coast, where the government is developing the port as a major trade gateway for northern Kenya and landlocked neighbouring countries.

Lamu Port handled its first cargo ships in 2021 and is intended to open a new transport corridor linking the region to the Indian Ocean.

For Dangote, the location offers a potential platform for supplying multiple markets while anchoring additional industrial activity around the port.

Kenyan officials expect the refinery to support petrochemical and bitumen production and create more than 50,000 jobs.

Refinery faces supply and environmental hurdles

The development is nevertheless facing questions over whether the region can provide sufficient crude oil and supporting infrastructure to sustain a refinery of the proposed scale.

Environmental groups have also challenged the project because of its potential impact on Lamu Old Town, a World Heritage site and an area with fragile marine ecosystems. Kenya’s High Court has ordered parts of the site preserved pending a hearing in a case brought by local residents.

Dangote has rejected the opposition, attributing it to traders and businesses whose existing fuel-related businesses could be threatened by the refinery.

The project represents Dangote’s latest attempt to reproduce the industrial model behind his 700,000-barrel-per-day Nigerian refinery — this time in a region where the gap between fuel consumption and local refining capacity remains substantial.