President William Ruto has tasked his deputy, Kithure Kindiki, to chair a team of government and private sector representatives to prepare for investments in East Africa’s oil refinery, even as Africa’s richest man, Aliko Dangote, announced the $2.2 trillion (Sh280 trillion) investment will be located in Lamu County.
Speaking at State House, Nairobi during the signing of the Sovereign Wealth Fund Bill, 2026 into law, Dr Ruto announced that a date for the ground-breaking ceremony of the refinery has already been set.
“We have set a date for the ground-breaking ceremony. We are taking steps to take Kenya to be a first-world nation,” Dr Ruto said.
The Sovereign Wealth Fund Act, 2026, establishes three components into which proceeds of minerals and petroleum wealth shall be deposited.
They are the Stabilisation Fund, the Strategic Infrastructure Investment Fund, and the Future Generations Fund.
The Stabilisation Fund shall be used to provide the national government with resources for management of extraordinary internal and external shocks which may affect micro-economic stability.
The Strategic Infrastructure Investment Fund component is to provide funding for strategic infrastructure investment priorities that are aligned to the national development plan.
The Future Generation Fund component is meant to build a savings base for future generations when the revenue from the minerals and petroleum are depleted.
The Act ring-fences 30 percent of all proceeds of all minerals and petroleum revenues to the Future Generations Fund.
The law also prohibits the use of the Future Generations Fund from any form of advances, credits, and collateral by the government.
Dr Ruto’s remarks came hours after Nigeria's Dangote Group announced plans to finance a proposed 700,000-barrel-per-day oil refinery in Kenya through internal cash flow, bonds and an initial public offering,
Reuters reported that a senior company executive had told the publication that the refinery, East Africa's largest refining project, is expected to take up to three years to build and would supply refined petroleum products to Kenya and neighbouring countries, helping to reduce East Africa's dependence on imported fuels.
Reuters reported that the refinery would also fulfil Dangote's ambition to expand fuel-processing capacity across Africa following the start-up of its 650,000-barrel-per-day refinery in Lagos.
"The site has been selected, soil tests are under way, and design and engineering work has commenced. Kenya was the choice from the beginning," Edwin Devakumar, Dangote Industries' vice president for oil and gas, told Reuters.
The refinery, which would be built on the island of Lamu, off the coast of Kenya, would mark Dangote Group's biggest refining investment outside Nigeria.
Mr Devakumar said the refinery would be financed through a mix of internally generated cash, bonds and proceeds from a planned initial public offering. He did not disclose the project's exact cost, but said it would be comparable to that of the Lagos refinery.
Built by Aliko Dangote, ranked as Africa's richest man by Forbes, the Lagos refinery had cost more than $20 billion by the time it began operating in 2024.
The company previously considered Tanzania's port city of Tanga before switching to Kenya, citing infrastructure, logistics and market considerations.
