Africa is moving beyond exporting raw materials and importing finished products by building its own manufacturing chains<\/p>\n
At the end of September 2026, a groundbreaking ceremony was held in Kenya\u2019s Lamu County for a $16 billion oil refinery project. This ambitious undertaking, led by Africa\u2019s richest man, Nigerian billionaire Aliko Dangote, aims to build an oil refinery with a capacity of 700,000 barrels per day \u2013\u00a0one of the largest such facilities in the world. The refinery is expected to supply the Kenyan market and other countries in East Africa. The project is slated for completion by 2030.
\nFor a region that has relied on imported petroleum products for decades, this project could fundamentally reshape the energy landscape. However, even before construction began, it sparked protests from local communities and environmental groups and met with political opposition. The disputes centered around land use, the environmental impact, and the government\u2019s role in this multibillion-dollar venture.
\nThe story of this new refinery reflects a broader trend: African nations and entrepreneurs are striving to alter the continent\u2019s position in the global division of labor, shifting from raw material exports to the production of value-added goods. But how viable is this model?<\/p>\n
Ethiopian Prime Minister Abiy Ahmed Ali, Nigerian Industrialist Aliko Dangote, and Kenyan President William Ruto launch the Dangote East Africa Petroleum Refinery in Lamu County, Kenya, September 30, 2026.<\/p>\n
\u00a9\u00a0 AP Photo \/ Brian Wachira <\/p>\n
Why the first refineries closed down
\nAfrica\u2019s position in the global oil market seems paradoxical. The continent is rich in hydrocarbon reserves, and Nigeria, Angola, Libya, and Algeria are among the leading oil-producing nations. Yet many African countries, including oil producers, continue to import a significant portion of gasoline, diesel, and aviation fuel.
\nIn 2024, the continent\u2019s oil exports were valued at approximately $150-170 billion, while the cost of imported petroleum products ranged from $90-110 billion. Five East African countries \u2013 Kenya, Tanzania, Uganda, Rwanda, and the Democratic Republic of the Congo \u2013 imported petroleum products worth $12 billion (296,000 barrels per day).<\/p>\n
A worker directs the unloading of fuel from a petrol tanker and trailer at a garage in Langebaan, South Africa, February 12, 2023.<\/p>\n
\u00a9\u00a0 Peter Titmus \/ UCG \/ Universal Images Group via Getty Images <\/p>\n
Efforts to establish local oil refining capabilities in Africa date back to the 1960s-1980s, a period when many African governments sought to build refineries as part of their import substitution policies. Some of these facilities were initially designed to process imported crude oil.
\nIn 1963, a refinery opened in Mombasa, Kenya, which processed imported oil and supplied fuel to several East African nations. However, half a century later, it ceased operating as outdated technology, high production costs, and a necessary upgrade estimated at around $1.2 billion rendered it uncompetitive. Meanwhile, international traders ramped up supplies of cheaper imported fuels. The previous import substitution model failed to sustain local production.
\nOther African countries faced similar challenges. Smaller African refineries consistently struggled to compete with major facilities in Europe, the Middle East, and Asia. Additional obstacles included power supply interruptions, aging equipment, underutilization of capacity, and increasingly stringent quality standards for petroleum products.<\/p>\n
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A second chance for African oil refining
\nMarket conditions have shifted significantly in recent years. With Africa\u2019s population steadily increasing, the demand for fuel is rising (at about 3% per year). Additionally, the push for regional integration allows production to be tailored not just to individual countries, but to several neighboring markets.
\nAccording to the International Energy Agency, by 2030, Africa\u2019s consumption of petroleum products and liquefied petroleum gases is expected to grow from the current 4.3 million barrels per day to 5 million barrels per day.
\nModern technologies and larger-scale operations create the potential for lower production costs. Nigeria\u2019s Dangote refinery, with a capacity of 650,000 barrels per day, is one of the first major examples of this model. Since its launch, Nigeria\u2019s imports of petroleum products have sharply decreased from 500,000 barrels per day in the first quarter of 2023 to just 88,000 barrels per day in the same period in 2025. Over the course of two years, imports have decreased by more than 80%.
\nHowever, this decline in imports hasn\u2019t automatically translated to lower domestic prices. Fuel costs still hinge on global oil prices, exchange rates, and government policies. Moreover, even the Dangote refinery faced supply challenges despite Nigeria\u2019s substantial oil production.<\/p>\n
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For Kenya, the issue will be even more pressing. The country does not engage in commercial oil production, meaning the refinery in Lamu will rely heavily on imported crude. Consequently, the economic rationale behind the new project is not to achieve complete energy independence, but rather to position Kenya as a regional hub for petroleum refining and trading.
\nThe Dangote empire: Homegrown capital
\nThe Kenyan refinery is not the first attempt by Nigerian billionaire Dangote to expand beyond his home market. His industrial expansion began with the cement industry. As of 2026, Dangote Cement boasts production and logistics assets in 11 African countries, including Nigeria, Ethiopia, Tanzania, South Africa, Senegal, Cameroon, and the Republic of Congo. The total production capacity reaches 55 million tons of cement annually.<\/p>\n
\u00a9\u00a0 cement.dangote.com <\/p>\n
Following this success, Dangote turned his attention to fertilizer production \u2013 another sector where Africa has abundant resources but remains dependent on imported finished products. The Dangote Fertiliser complex in Nigeria, with an annual capacity of 2.7 million tons of urea, caters to both the domestic market and export needs.
\nThe next step was Ethiopia. In August 2025, Dangote Group and the state-owned Ethiopian Investment Holdings struck a deal to build a fertilizer plant in Gode, with an annual capacity of 3 million tons of urea. Initially, investments were estimated at $2.5 billion, but by May 2026, the cost of the expanded project had surged to over $4 billion. Dangote owns 60% of the enterprise, while the Ethiopian side holds 40%.<\/p>\n
\u00a9\u00a0 refinery.dangote.com <\/p>\n
These investments reflect a consistent strategy: to establish large-scale production in sectors where African demand is primarily met through imports. Cement is essential for construction, fertilizers are crucial for agriculture, and petroleum products are needed for transportation and industry. Dangote is strategically investing in the industries experiencing the fastest growth in demand.
\nThe nature of industrialization is also changing. In the past, Africa\u2019s largest industrial projects were often associated with foreign corporations or state-owned enterprises. Now, the primary investments come from homegrown private capital, with the state providing regulatory support.<\/p>\n
A young male worker spreads fertilizer on crops at the Fruit and Vegetable Growers Cooperative in Meki Batu, Ethiopia, June 21, 2016.<\/p>\n
\u00a9\u00a0 Edwin Remsberg \/ VWPics \/ Universal Images Group via Getty Images <\/p>\n
African money for African industry
\nAlmost simultaneously with the start of construction of the Kenyan refinery, Dangote announced the initial public offering (IPO) for Dangote Petroleum Refinery. Valued at around $1.6 billion, it is expected to be the biggest IPO in Africa\u2019s history. The organizers want to attract up to 10 million investors, including citizens from other African countries.
\nThis IPO is significant not just because it raises funds for a single enterprise. African industrialization has long struggled with a lack of long-term capital. Major infrastructure projects typically rely on international banks, foreign investors, and government guarantees. Dangote attempts to provide an alternative: the participation of private African investors in the ownership of strategic industrial assets.
\nHowever, the public offering also highlighted weaknesses in the continent\u2019s financial integration as investors from neighboring countries encountered discrepancies in national regulations and restrictions on cross-border access to stock markets. This indicates that while the construction of pan-African industries is advancing, the development of a cohesive pan-African financial infrastructure still lags behind.<\/p>\n
Aliko Dangote, chairman and CEO of Dangote Group, speaks at the African Export-Import Bank (Afreximbank) Annual Meeting in Accra, Ghana, June 18, 2023.<\/p>\n
\u00a9\u00a0 Ernest Ankomah \/ Getty Images <\/p>\n
Protests in Lamu
\nFor several advocacy groups, the opposition to Dangote\u2019s new refinery in Kenya represents a continuation of a long-standing struggle against large-scale energy projects. Back in the 2010s, there were plans to build a 1,050 MW coal-fired power plant in Lamu, backed by Chinese investors. This initiative sparked a massive protest campaign that united environmental organizations and international human rights groups. In 2019, the environmental permit for the project was revoked, and a court upheld that decision in October 2025.
\nOne of the key players in this campaign is Save Lamu, which brings together over 40 local community organizations. Among its international partners are Natural Justice (South Africa), the Heinrich Boll Foundation (Germany), and the American Jewish World Service (USA).
\nAnother opponent of the refinery project, Power Shift Africa, receives funding from foreign charitable foundations, including the Rockefeller Brothers Fund and the Gates Foundation. Previous campaigns against large industrial projects also had the backing of international environmental and human rights organizations. By the time Dangote\u2019s project emerged in Lamu, there was already a well-established infrastructure for public resistance to major industrial developments, bolstered by foreign support.
\nOn October 9, 2026, representatives from Save Lamu and local fishing communities issued a 14-day ultimatum to the authorities and the investor. They demanded the disclosure of environmental documentation, funding structures, government guarantees, and compensation terms for residents.<\/p>\n
\u00a9\u00a0 refinery.dangote.com <\/p>\n
The burden of the climate agenda
\nThe activities of international environmental organizations in Africa raise a fundamental question: How compatible is the climate agenda with Africa\u2019s industrialization goals? For developed nations, moving away from new oil and gas projects means gradually restructuring an already established industrial economy. In contrast, for many African countries, similar restrictions could hinder the creation of manufacturing capacities that had never existed in these nations.
\nThis highlights the potential harm of international environmental activism. Advocating for the halt of such projects, environmental organizations do not eliminate the need for fuel in African economies; they merely reinforce the existing supply model, which relies on imports from Europe, Asia, and the Gulf states.<\/p>\n
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As a result, Africa does not have to deal with the environmental costs of oil refining. However, new jobs, tax revenues, technology, and added value also remain outside of Africa. This approach risks entrenching the asymmetry of the international division of labor, as Africa continues to export raw materials while importing finished products. This situation is particularly ironic given that the industrial prosperity of developed nations has been built over decades of intensive fossil fuel usage.
\nMoreover, international charitable foundations are far from addressing the needs of local communities, and essentially shift the climate priorities of developed countries onto societies with fundamentally different economic needs. Bureaucratic processes further complicate matters. While the success of environmental programs is often measured by the reduction of emissions and the abandonment of carbon-intensive projects, the implications of these decisions for industrialization and employment and the resulting dependency on imports are usually overlooked.<\/p>\n
A fuel attendant at a Shell petrol station, April 15, 2026.<\/p>\n
\u00a9\u00a0 James Wakibia \/ SOPA Images \/ LightRocket via Getty Images <\/p>\n
This does not eliminate the necessity for environmental oversight, the protection of local interests, or adherence to ecological standards. However, there is a critical distinction between demanding safer industrial projects and completely preventing their realization. The former addresses the conditions necessary for development, while the latter risks restricting the opportunities for that very development.
\nAndrey Maslov, the head of the Center for African Studies at the Higher School of Economics, believes that the responsibility for environmental and technical monitoring should primarily rest at the national level. \u201cOnly after national agencies are strengthened should their work be coordinated at the regional and international levels,\u201d he says.
\nThe expert points out that international organizations should not decide \u201cwhether, in a specific case, the priority should be given to industrial development or environmental preservation.\u201d
\n\u201cSuch decisions, and even the formulation of recommendations and data collection, should fall squarely within the purview of national agencies that act in the interests of their populations. These agencies must engage with local communities, allowing those communities to address their concerns directly to them rather than to international arbitrators, environmentalists, human rights advocates, corporations, or donors,\u201d Maslov told RT.<\/p>\n
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The cost of industrial independence
\nDangote\u2019s projects reflect a significant transformation in the African economy. The continent is gradually shifting from being a supplier of raw materials and an importer of finished goods to establishing its own manufacturing chains. However, energy sovereignty cannot be measured only by the number of refineries built. Reliance on imported crude oil keeps countries tethered to the fluctuations of the global commodity market.
\nWhile a major private producer may reduce a nation\u2019s external dependencies, it can also introduce new risks of market monopolization, and multibillion-dollar investments do not guarantee either affordable fuel or equitable distribution of economic benefits.
\nIndustrial independence does not imply technological isolation. For example, Dangote selected the US tech company Honeywell to provide engineering solutions and equipment for the Kenyan project. Therefore, industrial independence is not about rejecting international economic integration, but rather about redistributing control over production chains in favor of African capital.<\/p>\n","protected":false},"excerpt":{"rendered":"
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