Dangote’s 700,000-Bpd Kenya Refinery Opens a New Market for Global Crude

Dangote Industries broke ground on a $16 billion refinery in Lamu, Kenya, on September 30, starting construction of a facility planned to process 700,000 barrels of crude a day from 2030.

The project will produce petroleum products for Kenya and neighboring East African markets.

Kenya has yet to begin commercial crude production, while the new refinery will need a steady supply once operations start.

Uganda and South Sudan are among the regional producers being considered, with future Kenyan production also expected to enter the supply mix.

Dangote has said the refinery will source crude from both regional and international producers.

The plan puts East African oil projects alongside established exporters competing for supply contracts before Lamu begins production in 2030.

East Africa Needs More Crude Production to Supply Lamu

Kenya’s South Lokichar fields are not expected to begin commercial production until 2032. Current plans put output at about 50,000 barrels a day, with a pipeline planned from Turkana to the coast.

Uganda expects the Tilenga and Kingfisher projects to produce about 230,000 barrels a day.

The 1,443-kilometre East African Crude Oil Pipeline is designed to carry as much as 246,000 barrels a day to Tanzania for export. Uganda is also pursuing a 60,000-bpd refinery supplied from its own fields.

South Sudan was producing about 150,000 barrels a day after shipments through Sudan resumed.

Its oil reaches international markets through Sudan, where conflict has repeatedly interrupted exports and damaged infrastructure along the route.

Lamu would have to compete with existing export routes and domestic projects for part of the region’s production.

Kenya’s own commercial output is currently scheduled to begin after the refinery’s planned start.

African and Global Crude Will Compete for Lamu

NNPC offered Bonny Light and Cawthorne crude for September export, with Bonny Light loadings scheduled at about 364,000 barrels a day.

Angola continues to export crude to buyers in Asia, including India. Dangote has not disclosed the crude grades it plans to process at Lamu, so the refinery’s requirements cannot yet be matched with individual Nigerian or Angolan grades.

Middle East crude exports reached 16.3 million barrels a day in September. Saudi Arabia accounted for about 5.4 million barrels a day, while Saudi and Emirati cargoes continued moving through the Indian Ocean to Asian buyers.

Freight rates on Gulf routes have increased during 2026 as shipping through the Strait of Hormuz faced disruption.

Lamu would consume about 179 million barrels a year at 70% utilization, about 217 million at 85% and almost 230 million at 90%. Prices for delivering those barrels to the refinery have not been established.

Supply agreements could begin identifying the crude sources during construction. Producers in West Africa and the Gulf would then be competing for contracts before the refinery starts operating.

Dangote Is Building More Buying Power in the Crude Market

Dangote said its Lagos refinery was processing about 650,000 barrels of crude a day in September. The company plans to increase capacity at the site to 1.4 million barrels a day by 2029.

NNPC supplies part of the refinery’s feedstock under Nigeria’s naira-for-crude arrangement. Dangote also buys crude abroad and has imported cargoes from the United States, giving overseas producers a place in a supply chain that initially relied heavily on Nigerian oil.

A new Dangote shipping operation will handle crude and refined products. The business is being developed as the company expands its refining operations in Africa.

Lamu would bring another procurement operation into that business from 2030 if commissioning remains on schedule. By then, Dangote could be negotiating supply agreements for Kenya while continuing to buy Nigerian and imported crude for Lagos.

Crude Contracts Will Decide Who Supplies Lamu

Dangote has yet to name the producers or traders that will supply Lamu. Crude purchases can be negotiated while construction continues, putting the first supply agreements ahead of commissioning.

Those agreements will provide the clearest evidence of how much business East African producers secure and which exporters outside the region win contracts.

The first suppliers could be known years before crude begins flowing through the refinery.