Kenyan tribunal hands Africa’s richest man a win on $16 billion refinery, but government-funding and land disputes are not over

The Public Private Partnerships Petition Committee ruled that the Consumers Federation of Kenya, or COFEK, had failed to prove that the refinery qualified as a public-private partnership under Kenyan law.

Consequently, the committee said it lacked jurisdiction to compel the disclosure of agreements, feasibility studies and other documents sought by the consumer organisation.

The ruling gives Africa’s richest man a narrow victory as his company begins developing the $16 billion (KSh2.2 trillion) refinery and petrochemical complex in the coastal county of Lamu.

According to Bloomberg, the tribunal dismissed the petition after finding that the consumer organisation had not proved the privately owned refinery was a public-private partnership under Kenyan law.

COFEK filed its petition on September 30, the same day Dangote and Kenyan President William Ruto attended the project’s groundbreaking ceremony in Mokowe.

The organisation asked the tribunal to determine whether the refinery was being implemented as a public-private partnership and to reconsider any approvals that failed to meet Kenya’s PPP requirements.

It also sought information about the government’s proposed participation in the refinery, including the acquisition vehicle, share class, valuation and payment terms.

However, the tribunal found that COFEK had not provided evidence showing that the development met the legal definition of a public-private partnership or identified a decision that the committee had the authority to review.

The committee said reported government interest in acquiring shares would not automatically turn the privately developed refinery into a PPP.

Kenya’s National Treasury told the tribunal that discussions about possible state participation were still continuing.

Treasury Cabinet Secretary John Mbadi said the refinery would be developed, financed, owned and operated by Dangote’s project company, which would bear its commercial risks.

The government has not announced a final shareholding, disclosed an acquisition price or confirmed that public money has been released.

Dangote Refinery’s representative, Peter Lazarus, similarly told the tribunal that no government equity contribution or comparable public funding had been received.

Ruto previously said Kenya intended to invest in the refinery through its National Infrastructure Fund and public assets, including land.

Kenya has reportedly considered taking a 10% interest, although the government has not finalised or formally disclosed such an investment.

Reports have valued the proposed Kenyan stake at about $500 million (KSh64.9 billion). That figure should not be presented as an approved transaction or money already committed.

The National Infrastructure Fund told the tribunal that it had not made an investment decision and that any future participation would have to comply with its governing law and investment policy.

The government’s existing support includes granting the project special economic zone status and associated tax incentives.

The tribunal’s decision removes only the challenge brought under Kenya’s PPP legislation.

A separate High Court petition is seeking disclosure of the government’s potential financial commitments, public assets, guarantees, tax concessions and other support connected to the refinery.

Another case concerns claims by Lamu residents who say their families have ancestral interests in part of the land designated for the development.

An interim restriction affecting activities on the disputed land was lifted in October after the court found that the petitioners had identified the wrong parcel. The residents were allowed to amend their case, meaning the underlying land dispute has not been finally determined.

The latest ruling therefore does not amount to complete judicial clearance for construction. It only establishes that COFEK failed to demonstrate that the refinery should be reviewed under the PPP Act.

The refinery is designed to process as much as 700,000 barrels of crude oil daily, matching the planned capacity of Dangote’s refinery in his home country.

The Lamu development is expected to include a 1,000-megawatt power plant, fertiliser and chemical production facilities, storage tanks, pipelines and marine infrastructure.

Construction is expected to take approximately 40 months, with commissioning targeted for early 2030.

If completed, the complex could reduce East Africa’s dependence on imported refined petroleum products and turn Lamu into an important regional fuel and petrochemical hub.

The refinery’s progress will nevertheless depend on Dangote securing the required financing, permits and infrastructure while the remaining disputes concerning land and possible public participation continue.