President William Ruto has announced that the construction of the Ksh.2 trillion Dangote East Africa Refinery in Lamu County is expected to have a significant impact on the local economy. The project, spearheaded by Nigerian billionaire Aliko Dangote, is designed to process up to 700,000 barrels of crude oil daily, positioning Kenya as a potential petroleum refining hub serving East Africa and international markets. Ruto said the project would inject more than Ksh.2 billion into the economy every month through workers' wages during the four-year construction period.
The President made the announcement during the project's groundbreaking ceremony in Mokowe, Lamu County, on Wednesday, September 30. He stated that the wages would circulate through the local economy, benefiting shops, hotels, restaurants, transport operators, landlords, and other businesses in Lamu and beyond. Ruto also said that local businesses would benefit from increased economic activity, and that the project would create approximately 60,000 direct and indirect jobs.
The Ksh.2 trillion refinery is expected to have a significant impact on Kenya's energy security, industrialization, and regional integration. Ruto said that the project would complement the Lamu Port-South Sudan-Ethiopia Transport (LAPSSET) Corridor by generating commercial activity around the port and associated transport infrastructure. The project also envisages electricity generation capacity of up to 1,000 megawatts, part of which could eventually serve consumers beyond the refinery.
Ruto disclosed that Kenya spent Ksh.530 billion importing petroleum products last year, arguing that developing local refining capacity would help retain more value within the economy. He, however, acknowledged that establishing a refinery would not immediately eliminate the country's petroleum import bill, as crude oil would still have to be purchased and refined competitively. The President also challenged Dangote to deliver the project within the proposed 40-month timeline.
The President directed technical and vocational training institutions and universities to prepare young Kenyans for opportunities expected to arise from the refinery's construction and operation. He said the project would require welders, engineers, technicians, managers, and other skilled workers, while local businesses would have opportunities to supply construction materials, transport, accommodation, food, and logistics services. Ruto urged residents of Lamu and neighboring coastal counties to position themselves to benefit from the investment.
Ruto announced plans to develop a new town on the Lamu mainland, expand affordable housing, and pursue a major water supply project from the Tana River to meet anticipated demand arising from industrial and population growth. He also pledged that land matters would be handled lawfully and fairly, with environmental safeguards enforced throughout construction and operation. The President directed the national government, Lamu County Government, and the developer to establish a standing communication channel through which residents, businesses, and community organizations could raise concerns.
The project has faced concerns over land ownership and its potential environmental and social impact, with some residents challenging the use of land earmarked for the development. The Environment and Land Court in Malindi has ordered the prevailing status quo maintained on disputed land pending further proceedings scheduled for October 14, 2026. Ruto maintained that the project's success would ultimately depend on the economic opportunities it creates and the extent to which local communities benefit.
Key points
- The construction of the Ksh.2 trillion Dangote East Africa Refinery is expected to inject more than Ksh.2 billion into the economy every month through workers' wages.
- The project is expected to create approximately 60,000 direct and indirect jobs during the four-year construction period.
- The refinery is designed to process up to 700,000 barrels of crude oil daily, positioning Kenya as a potential petroleum refining hub serving East Africa and international markets.
