Nigerian billionaire and Dangote Group President and Chief Executive Aliko Dangote says plans to build a major oil refinery in Kenya have advanced significantly, with construction expected to begin by October and the facility projected to serve countries across East Africa and beyond.
Dangote disclosed the plans in an exclusive interview with Nancy Kacungira for Africa Enterprise, a major new multi-platform business programme by BBC Studios and BBC News that explores the worlds of Africa’s leading business innovators and showcases opportunities emerging across the continent.
The proposed refinery, which Dangote says will have a capacity of 700,000 barrels per day, is intended to reduce the dependence of African countries on imported refined petroleum products by increasing refining capacity within the continent.
“The plans have actually gone very far with Kenya. After ground breaking, we’ll start the construction very soon. We’re really planning something very big within the African continent,” Dangote told Africa Enterprise.
Dangote said the facility would not be designed solely for the Kenyan market but would operate as an East African refinery serving a wider regional market.
“The refinery is not only for Kenya. That’s why we are calling it East African refinery. You know, so that can serve a lot of countries, up to even Egypt,” said Dangote.
The project is expected to cost up to $16 billion, below the initial estimate of $17 billion. Dangote attributed the reduction partly to lessons learned from constructing his refinery in Lagos, as well as expectations that the Kenyan project will be completed more quickly.
“We’re just learning when we built the one here, so that’s really what is helping us. So, in terms of timing, we’ll be able to build in less than four years,” he said.
The project is expected to be financed through a combination of equity and debt, with Dangote saying about 30% of the funding would come from equity and 70% from debt.
Beyond the commercial investment, Dangote said the refinery could have a significant impact on energy security by helping countries secure reliable supplies of refined petroleum products.
“It’s going to have a massive impact, really, and then also it guarantees the countries getting their own products. They are not going to live hand to mouth and then you know the refinery is there. It’s for them,” he said.
The businessman also used the interview to call for greater African ownership of the continent’s economic development. He argued that African countries must move beyond repeatedly discussing their economic potential and take practical steps to turn that potential into jobs, production and prosperity.
“But you have to put that potential into reality. You have to, but the only way that you are going to do that is by us Africans to drive it. Nobody, and I repeat, nobody will come and drive it for us,” said Dangote.
He said Africa’s young population makes the creation of jobs and economic opportunities an urgent priority, while greater regional trade could help accelerate growth.
“You cannot imagine, you have one quarter of the world’s population…and you are not producing anything. If you are not productive, how do you create prosperity? You have to create, you know, jobs,” he said.
The planned Kenyan refinery therefore forms part of Dangote’s wider argument for greater African self-sufficiency, with investment in energy, production and intra-African trade helping the continent convert its resources and youthful population into sustained economic growth.
