Aliko Dangote, the wealthiest man in Africa, is set to build a massive oil refinery on Kenya’s coast. Speaking to a foreign news outlet, Dangote said he prefers Kenya to other countries for several reasons.
For one, its coastline has deep waters. Also, Kenya’s economy is larger than those of other countries in the region.
Kenya is set to benefit from an investment from Africa’s wealthiest man. Aliko Dangote from Nigeria is prepared to spend between $ 15 and $ 17 billion on the construction of a mega refinery in Kenya.
This is a welcome investment for Kenya, as the country seeks ways to mitigate problems emanating from the world’s oil shortages.
Efforts by Kenya to address high energy prices began even before the war between the US/Israel, and Iran began. Individuals are increasingly turning to solar energy, while others are opting for biofuels.
About Dangote’s Investment
The Nigerian billionaire plans to replicate his home country’s success in Kenya. In 2024, he invested in a massive oil refinery in the Nigerian state of Lagos. The benefits of that investment are being felt even more now that the world is short of oil.
Dangote’s refinery in Nigeria has mitigated shortages of petroleum products, not just for his home country, but also for its neighbours. Cameroon, Tanzania, Ghana, and Togo are among the countries that have benefitted from Nigerian supplies.
Like many countries in West and East Africa, these countries ordinarily rely on imports from Middle Eastern countries. With Qatar, Saudi Arabia, Kuwait, and those other countries being directly affected by the war in Iran, supplies have become very scarce, and prices are extra high.
How Beneficial Will the Refinery Be for Kenya?
Dangote’s oil refinery in Nigeria produces 650,000 barrels daily. Refining oil in Nigeria must be less costly than elsewhere in the region, considering that Nigeria has its own crude oil.
Nevertheless, even with Mombasa sourcing crude oil from Nigeria or elsewhere, Kenya is still bound to benefit immensely from the new refinery. Already, the world is bracing itself for a more prolonged oil problem.
This is because the much-awaited truce between the US and Iran seems to have fallen apart. Recently, US President Donald Trump trashed the list of conditions from Iran, presented by Pakistan, the mediator.
Meanwhile, Iran has categorically said it is not going to discuss its nuclear project as part of the peace negotiations. Yet President Trump takes the nuclear program issue as an integral part of the negotiations. Hence, there is no indication that the world oil market will stabilize soon.
In 2024, Kenya was said to consume around 116,000 barrels of oil per day (bpd). That amount must have increased by now, probably to beyond 130,000 bpd.
Hence, if Dangote’s Mombasa investment proves as successful as his Nigerian investment, the refinery should meet local consumption. It may also enable Kenya to build some reserves of petroleum products, and probably sell some to neighbouring countries.