LAMU, Kenya—President William Ruto is expected to preside over the groundbreaking of the Sh2.2 trillion East Africa Oil Refinery in Lamu on Wednesday, as the multibillion-shilling project moves into its construction phase despite an ongoing legal dispute over land earmarked for the development.
The refinery, being developed by Nigerian industrialist Aliko Dangote with backing from the Africa Finance Corporation (AFC), is designed to process up to 700,000 barrels of crude oil per day and supply petroleum products to markets across East Africa and beyond.
The project has, however, encountered opposition from residents who have moved to court claiming rights to part of the land targeted for the development.
The Malindi Environment and Land Court has ordered the parties to maintain the status quo on the disputed parcel, identified as LR No. 13061 in the Hindi/Manda Magogoni area, until October 14, when the matter is scheduled for further hearing. The court did not grant the applicants’ request to stop the planned groundbreaking ceremony.
The petition has been filed by 133 residents of Chandavai, who say they have occupied, cultivated and developed the affected land over many years and are seeking recognition of their interests in the acquisition and compensation process.
Ruto has strongly backed the refinery, describing the investment as an important component of efforts to strengthen regional energy security, support industrialisation and create new economic opportunities.
Dangote has also maintained that the groundbreaking will proceed despite the court case, saying the company is prepared to address the legal issues through the appropriate processes.
The refinery is expected to reduce the region’s dependence on imported refined petroleum products while supporting petrochemical, manufacturing, logistics and other industries around the Lamu Port and LAPSSET corridor.
The project nevertheless faces several challenges, including securing adequate crude supplies, financing, infrastructure and environmental and social concerns. Kenya currently has no commercial-scale crude production, making reliable regional and international feedstock arrangements important to the refinery’s long-term operations.
Preparations for construction have already gathered pace, with the Port of Lamu receiving 2,930 metric tonnes of heavy construction machinery aboard the MV Da Yang last week. The equipment is intended for use in developing the refinery.
The refinery is expected to become one of the largest planned refining projects in Africa, with construction targeted for completion around 2030 and the government projecting tens of thousands of jobs from the wider development.
Separately, Dangote is seeking to widen African participation in his business interests, with Kenyan investors set to access shares in the Dangote Petroleum Refinery through global depository receipts at Sh49 per share, subject to regulatory approval.
The share offer is separate from the proposed Lamu refinery and relates to Dangote’s existing Nigerian refinery.
