By Daniel Oluwatobiloba Popoola
Dangote Industries’ proposed $16 billion oil refinery in Kenya has come under a fresh legal challenge, with a consumer rights group questioning the project’s approval process, proposed government investment and potential financial obligations to Kenyan taxpayers and consumers.
The Consumers Federation of Kenya petitioned the Public Private Partnerships Petition Committee under Section 75 of Kenya’s Public Private Partnerships Act, 2021, seeking records on the refinery’s procurement, appraisal, due diligence and legal clearance processes.
The petition was disclosed on Friday by the federation’s Secretary-General, Stephen Mutoro, who said the group was also demanding details of the contracting authority and approvals granted for the project.
The federation is seeking clarification on a reported KSh21.5 billion seed allocation by the Kenyan Government and its proposed 10 per cent stake in the refinery, said to be valued at about $500 million.
Mutoro said the petition was also asking the committee to distinguish between funds budgeted, committed and actually disbursed by the government for the project.
The group further wants details of the investment vehicle through which Kenya would acquire its stake, the class of shares involved and the proposed payment terms.
Beyond the proposed equity investment, the federation is questioning possible government commitments relating to petroleum-product offtake, market protection and electricity supply.
It is also seeking clarification on potential contingent liabilities that could ultimately affect Kenyan taxpayers and consumers.
According to Mutoro, the federation has requested that the relevant records be produced within seven days, while authorities are expected to indicate where any requested record does not exist.
The consumer group is also asking the committee to set aside any approval found to be inconsistent with the law and remit the matter for reconsideration after proper appraisal, due diligence and conflict-of-interest checks.
The latest petition comes days after 133 residents of Lamu approached a Kenyan court over land earmarked for the refinery.
The residents are challenging the proposed use of land in the Hindi/Manda Magogoni area, with a status quo order reportedly issued on September 25.
Mutoro said the land case was separate from the consumer federation’s petition.
The legal challenges emerged shortly after Kenyan President William Ruto and Nigerian businessman and Chairman of Dangote Industries, Aliko Dangote, broke ground for the proposed refinery on September 30.
The facility is projected to process 700,000 barrels of crude oil per day and is expected to be completed in 2030.
The project is also expected to include a 1,000-megawatt power plant, while Dangote has offered regional governments a combined 30 per cent stake in the refinery, according to the report.
Speaking to the BBC ahead of the groundbreaking, Dangote dismissed the protests over the land and attributed the opposition to local marketers and international players.
He questioned the basis of the demonstrations and insisted that the project would proceed.
“To come and say some people are demonstrating, demonstrating about what? Have you ever seen people demonstrating against themselves in terms of development?” Dangote said.
He also said he was prepared to defend his business interests, while alleging that local marketers and international players were behind the protests.
The proposed refinery is expected to become Kenya’s largest infrastructure project since independence and Dangote’s biggest proposed investment outside Nigeria.
The latest petition, however, means the project faces scrutiny on multiple fronts, with questions now extending beyond the land dispute to the legality of its approval process, the proposed Kenyan government investment and possible financial commitments associated with the project.
