Nigerian billionaire Dangote favours Kenya over Tanzania for 650,000-bpd East Africa oil refinery

Nigerian billionaire Aliko Dangote, president of the conglomerate Dangote Industries, said he is considering Kenya as the preferred location for a proposed 650,000 barrels-per-day (bpd) refinery in East Africa, shifting focus away from an earlier plan centred on Tanzania.

Speaking to the Financial Times, Africa’s richest man said he was leaning towards the Kenyan port city of Mombasa because it “has a much larger, deeper port” and a larger domestic fuel market.

The proposed refinery, estimated to cost between $15bn and $17bn, would match the capacity of his 650,000-bpd Dangote Petroleum Refinery in Lagos, which began ramping up operations in 2024 and is now widely fregarded as the world’s largest single-train refinery. The plant this spring sharply increased exports across Africa after reaching full capacity, including cargoes to Tanzania, Ghana, Cameroon and Togo.

Dangote said the potential East African refinery would process crude from Uganda and other international suppliers, reducing regional dependence on imported refined petroleum products, adding that crude could be delivered by sea rather than relying solely on the planned East African Crude Oil Pipeline (c) linking Ugandan oilfields to Tanzania’s port of Tanga.

That planned 1,443-km export pipeline being developed by a consortium including TotalEnergies (EPA: TTE), China National Offshore Oil Corporation (CNOOC) and the governments of Uganda and Tanzania. It  is designed to transport crude from Uganda’s Lake Albert oilfields to Tanzania’s port of Tanga for export.

Dangote said a refinery project’s future would depend heavily on support from the Kenyan government. “The ball is in the hands of President [William] Ruto. Whatever President Ruto says is what I’ll do,” Dangote told the FT.

The potential refinery has intensified regional competition between Kenya and Tanzania over control of East Africa’s future refining and energy infrastructure.

Tanzania had previously been considered the leading candidate for the project owing to the proposed Uganda-Tanzania export pipeline terminating at Tanga. However, relations reportedly became strained after Ruto publicly referred to refinery discussions involving the neighbouring country before consultations had concluded with his Tanzanian counterpart, Samia Suluhu Hassan.

Dangote nevertheless said Tanzania remained a possible option if outstanding issues could be resolved if “they are able to sort themselves out.”

The proposal comes amid renewed concerns across Africa over fuel-supply security following geopolitical tensions in the Middle East and disruptions linked to the Strait of Hormuz, a critical global oil-shipping route.

East African countries currently import most refined petroleum products from overseas suppliers, leaving the region vulnerable to supply shocks and price volatility. In response, Kenya, Tanzania, Uganda, South Sudan and the Democratic Republic of Congo (DRC) have been discussing a joint regional refinery.

In April, President Ruto said the proposed project was under discussion around Tanzania’s port, while Dangote had said he was ready to lead the project if regional governments backed the plan. Meanwhile, Uganda is simultaneously advancing its own 60,000-bpd refinery project with UAE-backed investors, meaning East Africa could eventually see multiple competing refining centres rather than a single regional hub.

Dangote argues that any refinery project in East Africa – regardless of where it is built –would require not policy support and protection against low-cost fuel imports to remain commercially viable.

“There is no refinery in the world that can survive without that protection,” he told the FT, warning that cheaper imports from markets including Russia and India could undermine refining economics.

The comments come as Dangote’s Lagos refinery continues expanding exports of petrol, diesel and aviation fuel across African markets, while also helping reduce Nigeria’s dependence on imported refined products.

Dangote also confirmed plans for the Nigerian refinery’s capacity to more than double to 1.4mn bpd within the next 30 months, potentially placing the complex among the world’s largest refining hubs. To fund this expansion, the company recently secured backing from the African Export-Import Bank (Afreximbank), which underwrote $2.5bn out of a $4bn syndicated financing facility.

“We’ll be price movers in the market,” Dangote told the FT. “If we don’t invest in our own continent, who else will?”

In a separate earlier interview with The Africa Report on the margins of the Africa Forward summit in Nairobi, the Nigerian entrepreneur said, however, that he would not build without protection against dumped imports. “Anywhere where we are going to put up an industry, if they don’t have good anti-dumping laws and regulations, we will not invest in that place, no matter how good it is,” Dangote told the publication.

For Dangote, that the price of industrialisation in markets where local companies face structurally higher costs than their foreign rivals, The Africa Report writes. According to him, in Nigeria companies pay interest rates of about 30%, whereas competitors elsewhere borrow at 3%.

Meanwhile,  he is targeting a valuation of around $50bn for the Dangote Petroleum Refinery ahead of a planned stock market listing later in 2026, according to Bloomberg, which reported that it could sell up to a 10% stake through the Nigerian Exchange (NGX).

He is also planning a landmark cross-border public offering of in a move that could reshape capital markets across Africa and deepen regional investor participation.

Beyond Nigeria, Dangote Industries operates cement, fertiliser and industrial businesses across several African markets, including Ethiopia, Tanzania, Senegal, Zambia, South Africa and the Republic of Congo, making it one of the continent’s largest manufacturing and infrastructure conglomerates.