Dangote to sell 30% shareholding of new refinery to East African countries – Report

Dangote Group, led by Africa's richest man Aliko Dangote, has proposed selling a 30% stake in its planned 700,000 barrel-per-day refinery to East African countries. This strategic move aims to secure investment and partnerships for the mega crude-processing plant, which is slated to be located in Kenya.

Kenya is expected to take a 10% stake in the refinery, an investment estimated at around half a trillion dollars, according to David Ndii, a top economic advisor to Kenyan President Ruto. The total regional investment is projected at approximately $1.5 billion, with Ethiopia and Rwanda also expressing interest in participating. Ndii expressed confidence in securing the regional commitment, stating, "I don’t actually see a challenge in doing that, and if some of them are not off-taking we will backstop."

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The total for the region is about $1.5 billion. I don’t actually see a challenge in doing that, and if some of them are not off-taking we will backstop

This initiative comes after Dangote faced considerable challenges and delays in completing a refinery of similar capacity in his home country, Nigeria. The Nigerian refinery, initially projected for completion in 2016, experienced significant setbacks due to logistical issues, infrastructure constraints, and the COVID-19 pandemic. Dangote has publicly accused international oil companies and regulatory bodies of sabotaging his efforts, even likening the resistance to "the mafia in oil."

Dangote has alleged a conspiracy to frustrate his goal of reducing Nigeria's dependence on fuel imports, pointing to the issuance of new licenses for "dirty fuel" imports as part of this scheme. He also cited the resignation of the CEO of the Nigerian Midstream and Downstream Petroleum Regulatory Authority and the departure of a former NNPC Limited managing director as outcomes of these internal conflicts. A recent private placement for the Nigerian refinery raised $2.5 billion, valuing the project at $40 billion, ahead of a planned $5 billion initial public offer. The groundbreaking for the Kenyan refinery is anticipated next month.

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I knew there would be a fight. But I didn’t know that the mafia in oil, they are stronger than the mafia in drugs