Aliko Dangote wins Kenya court reprieve for Lamu refinery

Nigerian billionaire Aliko Dangote has cleared a legal hurdle facing his planned $16 billion oil refinery in Kenya after a court lifted an earlier restriction on activities at the project site in Lamu, although a dispute over land rights remains unresolved.

Judge Jane Onyango of the Malindi Environment and Land Court lifted the restriction on Wednesday, October 14, after finding that 133 residents who challenged the project had identified the wrong parcel of land in their petition. 

The court adjourned the case until November 24, when the amended petition is expected to be heard. The ruling removes the earlier restriction but does not settle the underlying dispute or end the residents’ legal challenge.

The case was brought by residents of Chandavai in Lamu County, who claim ancestral rights to land earmarked for the refinery. They have challenged the project over property rights and alleged shortcomings in the handling of land acquisition and environmental requirements.

In an interim order issued on September 25, the court directed the parties to maintain the status quo on the disputed land until the October 14 hearing. The order raised uncertainty over activities on the affected property as Dangote prepared to launch the project.

The proposed Lamu refinery is designed to process 700,000 barrels of crude oil per day, matching the capacity of Dangote’s refinery in Nigeria. Estimated at $16 billion, the project is intended to supply petroleum products to Kenya and other markets across East Africa.

Dangote and Kenyan President William Ruto formally launched the project on September 30. Dangote said he aimed to complete the facility within 40 months, while the planned complex is expected to include a 1,000-megawatt power plant.

The project is also part of Dangote’s broader push to expand his energy business beyond Nigeria. His group has offered East African governments a combined 30% equity stake in the refinery, with Kenya considering a 10% interest valued at about $500 million, according to earlier reports.

However, the land case is not the only legal challenge facing the investment. A separate petition in Kenya seeks disclosure of agreements and public commitments connected with the government’s proposed participation in the refinery.

The latest ruling therefore removes one immediate legal obstacle to work on the Lamu project, while questions over land rights and the terms of public participation remain before the courts.