Ruto, Dangote Set to Break Ground on Sh2.2tn Lamu Oil Refinery Amid Land Dispute

Nairobi, Kenya – On September 30, President William Ruto and Nigerian billionaire Aliko Dangote were set to officially kick off construction on the proposed Sh2.2 trillion East Africa Oil Refinery in Lamu. This mammoth industrial venture, part of a broader strategy to bolster Kenya's petroleum sector, is expected to process up to 700,000 barrels of crude oil daily, positioning it among Africa's largest planned refineries.

The groundbreaking ceremony at Lamu Port was anticipated to draw regional heads of state and government officials, with Deputy President Kithure Kindiki confirming preparations were on track. Dangote's arrival in Lamu on Tuesday preceded the event, alongside senior officials and dignitaries expected at the launch. The project, backed by Dangote Industries, aims to cement Kenya as a regional petroleum processing and distribution hub, potentially reducing dependence on imported refined petroleum and opening avenues for investment and employment.

However, the refinery faces a legal challenge from residents who claim ancestral rights to parts of the land earmarked for the development. The refinery, projected to cost around $16 billion (Sh2.2 trillion), is designed to process crude oil from Kenya and other African producers, including Uganda. President Ruto highlighted the project's alignment with Kenya's industrialization goals, emphasizing the potential for reduced reliance on imports and the creation of economic opportunities.

Dangote, optimistic about the venture's impact, pledged to generate over 50,000 jobs during construction and promised additional employment opportunities in sectors such as transportation, accommodation, and retail. The project is also expected to spur economic activity in Lamu and the broader Coast region, particularly in logistics, infrastructure, and industrial services.

Dangote suggested that Kenya and two other East African nations could hold a combined 30% stake in the refinery, fostering regional cooperation in the petroleum sector. The refinery's location near Lamu Port, part of the larger Lamu Port-South Sudan-Ethiopia Transport (LAPSSET) Corridor, would facilitate maritime transport and support the development of storage and pipeline infrastructure.

The first shipment of construction materials had already arrived at Lamu Port ahead of the groundbreaking. However, a land dispute involving 133 residents, who argue they have ancestral rights to the land, has been filed at the Environment and Land Court in Malindi, temporarily halting construction activities on the disputed area.