Dangote's $16 Billion Bet: Building a Refinery in Electric Vehicle Era

Aliko Dangote is building a $16 billion oil refinery in Lamu, Kenya, despite the shift towards electric vehicles and Kenya's own struggles to turn crude discoveries into commercial production.

The proposed 700,000-barrel-per-day refinery stands in contrast to Kenya's own oil prospects, which have been hindered by years of financing and infrastructure delays. British oil explorer Tullow Oil sold its Kenyan interests to Gulf Energy in 2025 after failing to achieve sustained production.

Dangote's experience with his Lagos refinery, built partly to address Nigeria's petroleum contradictions, has shaped his thinking in Kenya. He argues that a refinery doesn't have to be set up where crude oil is, citing Singapore and India as examples.

The Lamu refinery will produce petrol, diesel, jet fuel, polypropylene, and base oils, with Dangote betting that energy demand will remain strong despite the rise of electric vehicles. He expects Africa's oil demand to remain resilient for decades, while OPEC projects global consumption will continue rising through 2050.