The cart is before the horse. That appears to be the situation with the Lamu oil refinery spearheaded by Nigerian billionaire Aliko Dangote in partnership with the Kenyan government. The Dangote East African refinery is expected to cost up-to KSh2.2 trillion, take three years to complete, and is expected to produce 700,000 barrels per day.
Dangote made history three years ago when he launched the largest oil refinery in Nigeria, the Dangote Refinery. President Ruto got to tour the refinery back on 25th September ahead of the groundbreaking set for 30th September in Lamu.
President Ruto during his visit in Lagos to view the Nigerian refinery said, “We’re looking at a refinery that is also going to elevate our industrial scale. We are also looking at the opportunities that are going to come with this, especially in the space of improving our human capital in engineering,”
THE ODDS AGAINST LAMU REFINERY
Kenya discovered oil 14 years ago in Turkana but despite the discovery, the oil has stayed underground because of lack of proper infrastructure to harness and transport the oil. This being one of the challenges amidst the refinery. Kenya is estimated to initially produce 20,000 barrels and eventually scale up to 50,000 barrels per day which is way below what the refinery in Lamu has capacity to do which is 700,000 barrels per day.
Kenya Ports Authority (KPA) confirmed vessels docked on 26th September. The heavy machinery has already been seen on sight despite the protests by the local people and climate activists and land-law law suits. The local residents are protesting being displaced and not being considered for development. The courts also made a ruling but Dangote East Africa Refinery is set to move on schedule regardless.
ALL ROADS LEAD TO LAMU REGARDLESS
Initially, Tanzania was considered as a set up for the refinery but after meeting with President Suluhu, Dangote opted for the Kenyan Coast citing commercial and technical consideration.
Aliko Dangote during the visit of Ruto to the Nigerian refinery said, “You will see our power plant which is very big but the one of Lamu will be actually double because we are going to produce about 1,000 megawatt in Lamu out of petcoke and we will have 500 megawatt to sell to the government of Kenya.”
Dangote East Africa Refinery is expected to reduce East Africa’s reliance on imported fuels. It is expected to produce 100 million litres of petrol, diesel, and aviation fuel daily. Uganda and Tanzania partnered to establish a rival refining and storage hub in Tanga. Uganda intends to scale and be one of Africa’s largest oil producers.
The mega refinery in Lamu is set to become the largest project by Dangote Group outside Nigeria. Dangote kicked off Africa’s biggest IPO of the Nigerian refinery and is set to close later in October grossing $1.6 billion.
APERIT FM, HII NI YETU
