Dangote faces Kenya refinery hurdles
It is unclear where the planned refinery in Lamu, which Africa’s richest man aims to complete by 2030, will secure its feedstock from.
The Dangote Group, led by billionaire Aliko Dangote, is set to launch its Nigerian refinery IPO while simultaneously planning a similar plant in Kenya. However, the Kenyan project faces potential hurdles due to the complex supply chain and fundraising difficulties. The Lagos refinery currently sources crude oil from both within Nigeria and international markets.
For the Kenyan refinery planned in Lamu, it remains uncertain where the feedstock will be obtained, as Kenya relies heavily on Middle Eastern imports for its oil. A Dangote Industries executive expressed confidence that securing crude will not be an issue. Nevertheless, an analyst warned that fundraising for the $16 billion Kenyan project could prove challenging, considering Dangote's simultaneous efforts to double the capacity of the Lagos refinery.
Despite these concerns, Aliko Dangote remains optimistic about the medium-term margins, viewing the current situation as extremely bullish, particularly following the US-Iran war that has intensified the global diesel refining crunch.
Written by urgent.news from Semafor's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
