🚨 LAMU REFINERY: SHOW KENYANS THE ARITHMETIC
A 700,000-barrel-a-day refinery sounds spectacular.
But before the politicians arrive for the groundbreaking ceremony, there is one simple question:
WHERE WILL THE CRUDE COME FROM?
Kenya’s own crude production is nowhere near 700,000 barrels a day.
Uganda’s crude is linked to the Tanzania export route.
South Sudan already has established export arrangements and its own infrastructure challenges.
So how exactly does a 700,000-bpd refinery in Lamu secure enough crude — consistently and cheaply?
The answer appears to be imports.
And that creates another question:
At what cost?
Yes, Nigeria and India import crude.
But Nigeria is an oil-producing country.
India is located much closer to major Middle Eastern oil suppliers.
Kenya is not.
Every additional kilometre means additional logistics, freight, insurance and handling costs.
And a refinery doesn’t survive because it is big.
It survives because it can obtain cheap crude, move it efficiently, sell its products into a sufficiently large market and make money after all costs.
So let’s stop selling Kenyans the dream and start showing them the numbers.
Where will the 700,000 barrels come from?
What will each barrel cost when it reaches Lamu?
Who will buy the refined products?
What guarantees the refinery will operate at high utilisation?
Who is financing the project?
Who carries the losses if the economics don’t work?
Because when politicians are standing on the podium, everyone celebrates.
When contractors are getting contracts, everyone smiles.
But if the project eventually becomes commercially unsustainable, who ultimately carries the financial risk?
This is not about being pro-Dangote or anti-Dangote.
It is about Kenyan taxpayers demanding the numbers before committing to a project of this magnitude.
A groundbreaking ceremony is not a business model.
Show us the crude.
Show us the price.
Show us the market.
Show us the financing.
Show us the contracts.
Show us who carries the risk.
Kenya deserves the arithmetic before the applause.
#Kenya #Dangote #Lamu