Ethiopia is among several East African countries considering an equity investment in Nigerian billionaire Aliko Dangote’s proposed oil refinery in Lamu, Kenya, according to Bloomberg.

Dangote Group has offered East African countries a combined 30% stake in the planned refinery. Kenya is expected to seek a 10% share valued at about $500 million, while Ethiopia and Rwanda have also expressed interest. If all three countries participate, regional investment in the project could reach approximately $1.5 billion.

The proposed Lamu refinery is expected to have a processing capacity of up to 700,000 barrels of crude oil per day, with refinery construction costs estimated at between $16 billion and $17 billion. Including associated port and infrastructure investments, the wider project could reach a total value of around $20 billion.

The refinery is planned to process crude oil from Kenya and Uganda and supply refined petroleum products to markets across East Africa.

For Ethiopia, the potential investment would add to its growing economic cooperation with Dangote Group. The Nigerian conglomerate is already involved in plans to develop a $2.5 billion fertilizer complex in the Somali Region, with the broader project later projected to exceed $4 billion.

The fertilizer project is also linked to a separate 25-year natural gas supply agreement valued at approximately $4.2 billion, with gas expected to be sourced from Ethiopia’s Calub gas field.

If developed, the Lamu refinery would represent Dangote Group’s major expansion of its refining operations into East Africa, following the company’s 650,000-barrel-per-day refinery in Nigeria.

Ethiopia’s participation in the Lamu refinery remains under consideration and has not yet been confirmed as a finalized investment.

Source: Bloomberg