A Kenyan court has temporarily halted construction on Aliko Dangote's planned $16 billion oil refinery in Lamu, located on Kenya's northeastern coast. The decision came after 133 local residents and farmers from Chandavai filed a lawsuit, alleging that the project would lead to their forceful eviction, property destruction, and a lack of resettlement plans. The petitioners also claim that neither Dangote nor Kenyan authorities have conducted the mandatory environmental impact assessment or fulfilled public participation requirements outlined in Kenya's constitution.
Justice Jane Onyango of the Malindi Environment and Land Court ordered that the "status quo prevailing" in the Lamu area be maintained until October 14, when the court will provide further directions. While the ruling does not outright stop the groundbreaking ceremony planned for September 30 by President William Ruto, it specifically freezes activity on a contested parcel of land, LR No. 13061. The residents argue that their families have farmed and lived on this land for generations without compensation or relocation offers.
The refinery, designed to process 700,000 barrels of crude oil per day, is a key component of the multi-billion-dollar Lamu Port-South Sudan-Ethiopia Transport corridor. This project aims to reduce eastern Africa's reliance on imported refined fuel, with Kenya offering a 10% equity stake to itself and a combined 30% to other East African countries. The total cost of the refinery is estimated between $15 billion and $17 billion, with approximately 70% expected from debt. The project is projected to create about 60,000 jobs during construction.
The petitioners have sued various government bodies, including the Office of the President, the Cabinet Secretary for Defence, and the National Land Commission, alongside Dangote Industries. They allege that government agents damaged crops and property in August 2024 without notice or compensation, and that the acquisition process failed to comply with statutory requirements for surveys, valuations, and compensation. This legal challenge risks delaying a project critical for regional energy independence, especially given rising fuel prices due to geopolitical events.
