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Dangote Group will begin work on its proposed $17 billion oil refinery in Kenya by the end of September, with the facility expected to be completed within three years.
Aliko Dangote, Africa’s richest man, disclosed this on Monday during the opening of the initial public offering (IPO) of Dangote Petroleum Refinery and Petrochemicals FZE in Lagos, Nigeria’s commercial capital.
The announcement comes as the Dangote refinery’s IPO begins trading activities today, with the public offer expected to raise about $1.6 billion and value the business at almost $50 billion.
The IPO has also triggered an unprecedented digital race among Nigerian stockbrokers, banks and fintech companies seeking to participate in the share sale, with the transaction targeting up to 10 million investors.
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What he’s saying
The proposed refinery will be located in Lamu on Kenya’s coast, cost an estimated $17 billion and is expected to take about three years to complete, expanding Dangote’s refining operations from West Africa into East Africa.
Dangote said work on the facility is expected to begin by the end of the month, with the project forming part of his broader plan to expand the group’s energy business across Africa.
- “There’s a lot of value in Africa. Africa is like a scratch card unless you scratch it, you will not see the use of it. The opportunities are immense,” Dangote said.
The billionaire also disclosed plans to expand the group’s energy infrastructure beyond the Kenya refinery, including a 2,650-kilometre pipeline that will run from Namibia through Botswana to South Africa.
- “We are also taking up another line, which will now go to Zimbabwe,” Dangote said, adding that work on the project will start next month.
Get up to speed
The proposed Kenya refinery is part of Dangote Group’s broader expansion across Africa and is expected to replicate the scale and design of the Dangote Refinery in Lagos, Nigeria, which is currently Africa’s largest single-train refinery.
- In July, a spokesperson for Dangote Industries Limited disclosed that the planned refinery on Kenya’s coast was estimated to cost $17 billion and would take about five years to complete.
- The project is expected to significantly expand Dangote’s refining footprint beyond Nigeria, connecting its operations to East Africa and extending its reach from the Atlantic to the Indian Ocean.
- In August, Dangote offered East African countries a combined 30% equity stake in the proposed Kenyan refinery, potentially giving regional investors access to about $1.5 billion worth of the project.
David Ndii, Kenyan President William Ruto’s economic adviser, disclosed the proposal at a capital markets forum in Nairobi, saying Kenya would take a 10% stake while Ethiopia and Rwanda had also expressed interest.
What you should know
The Dangote Petroleum Refinery and Petrochemicals initial public offering has triggered an unprecedented digital race among Nigerian stockbrokers, banks and fintech companies seeking to participate in what could become the country’s largest retail-driven share sale.
- Sources familiar with the transaction told Nairametrics that the unusually large number of participating platforms was driven by Dangote’s insistence that the IPO should attract as many as 10 million subscribers and be built primarily around digital distribution.
- The channels participating in the offer include apps operated by 20 banks, two mobile money companies, the Nigerian Exchange’s NGX Invest platform and 32 fintech and investment firms.
Investment platform Bamboo experienced login failures on Monday after a surge of users flooded the app to participate in the Dangote Refinery and Petrochemicals FZE public offer.
