Nigerian businessman Aliko Dangote’s proposed Sh2 trillion oil refinery in Lamu has been welcomed as a major investment capable of creating thousands of jobs and expanding Kenya’s industrial base.
But journalist Kwamchetsi Makokha has called for greater scrutiny of the project’s commercial assumptions before construction gathers pace.
The proposed refinery is designed to process 700,000 barrels of crude oil per day, with the project expected to create about 60,000 direct and indirect jobs.
A groundbreaking ceremony is scheduled for September 30, 2026, despite an ongoing land dispute over part of the proposed site.
Makokha said he welcomed the potential economic benefits but argued that the history of the project’s location deserved closer attention.
“I love the idea of 60,000 jobs in Kenya, the by-products of the Dangote refinery and the prestige. But I have a small ask. Let’s get the chronology right,” he said.
According to Makokha, the initial proposal presented by President William Ruto in April centred on a regional refinery in Tanga, Tanzania, supplied by crude from Kenya, Uganda, South Sudan and the Democratic Republic of Congo.
He said Dangote had indicated his willingness to develop the facility if regional governments agreed, creating a model based on regional crude supplies, infrastructure and petroleum markets.
The location subsequently shifted towards Kenya, with Mombasa emerging as a possible site before Dangote announced in July that Lamu had been selected.
The company has attributed the decision to commercial, technical and logistical considerations.
Makokha said the change of location was not necessarily evidence of a problem with the Lamu project, but argued that the public should understand what had changed in the underlying business case.
“If the project delivers the jobs, downstream industries and industrial transformation being promised, it will be big. But precisely because the project matters, the scrutiny should begin before construction does,” he said.
One of the central issues he raised was crude supply. Kenya currently has limited oil production, meaning the refinery would have to rely heavily on crude from regional producers and international markets. Reuters has similarly identified crude supply as one of the project's major challenges.
Makokha questioned whether the proposed refinery would have enough competitively priced crude to operate close to its 700,000-barrel-per-day capacity.
“The impressive number is 700,000 barrels a day; the economically important number is how much crude it can secure, at what delivered cost, and how much of that capacity it can keep running,” he said.
He called for greater transparency on the refinery’s crude-supply assumptions, infrastructure requirements, financing arrangements, projected utilisation and intended markets.
“There is nothing wrong with changing course when the facts change. But when a project moves between three locations within a few months, the public deserves to understand what changed in the business case,” Makokha said.
He ultimately argued that the regional economic logic behind the project should now be clearly demonstrated.
“Now that the refinery is in Kenya, let us see the regional economics that make Lamu work.”