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Dangote: Court Dispute Won’t Stop $16bn Lamu Refinery

Aliko Dangote has expressed confidence that his proposed $16 billion Lamu Refinery in Kenya will proceed despite a court order restricting activities on the disputed project site.

The Malindi Environment and Land Court directed parties to maintain the status quo on the land until October 14, when it will hear a suit filed by 133 residents of Chandavai in Lamu County.

The residents claim the refinery site forms part of their ancestral land, where their families have lived and farmed for generations. They are seeking recognition of their land rights and compensation while raising concerns about the project’s potential impact on their property and livelihoods.

The court order temporarily bars activities including clearing, excavation, fencing, demolition and construction on the affected portions of the land. It did not, however, expressly stop the planned September 30 groundbreaking ceremony.

Dangote Group said the ceremony had not been cancelled, although activities at the site could be affected by the order.

“The court has not halted the groundbreaking ceremony of the refinery at this stage. However, activities at the site may be affected by the ruling as both parties are required not to carry activities until the case is heard on 14th October,” the company said.

Speaking at an investor event in Nairobi, Dangote played down concerns that the legal dispute could derail the project.

“I’m sure some of you must have seen one court (has) given an order that we shouldn’t do any construction? I said no, no. This is normal for us in Africa. … In fact, this is even small,” he said.

“Anyone who wants to cause trouble, we are ready for them,” he added.

Dangote later told investors, “If you want to go to court to stop the Lamu Refinery, go ahead; we are ready for you.”

The proposed refinery is expected to cost about $16 billion, process 700,000 barrels of crude per day and be completed by 2030.

It is designed to process crude from Kenya’s Turkana oilfields and other African sources, with the goal of reducing East Africa’s dependence on imported petroleum products.

Meanwhile, the African Energy Chamber (AEC) condemned the court order and called for a swift resolution of the land dispute to prevent prolonged litigation from delaying the project.

AEC Executive Chairman NJ Ayuk said land rights, compensation and environmental concerns should be addressed under Kenyan law but should not indefinitely delay the refinery.

“Africa cannot continue exporting its energy security and then acting surprised when conflicts thousands of kilometres away determine what our people pay for fuel. The communities of Lamu must have their rights respected, and legitimate questions around land and compensation should be resolved quickly and fairly,” he said.

“But those issues cannot become an excuse to indefinitely delay one of the most important downstream investments East Africa has seen in decades,” Ayuk added.

The chamber said the refinery could strengthen East Africa’s fuel security, noting that the region has relied heavily on imported petroleum products since Kenya Petroleum Refineries stopped operating in 2013.

Ayuk cited Dangote’s refinery in Nigeria as an example of how expanded refining capacity could reduce imports and increase refined-product exports.

“Aliko Dangote has already demonstrated what African capital and African entrepreneurship can achieve in refining. Kenya now has an opportunity to build that same resilience in East Africa. Resolve the dispute, protect the communities and build the refinery,” he said.

 

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