Getting to the bottom of the race for East Africa's $17 billion refinery
The President of the United Republic, Samia Suluhu Hassan, speaking with Aliko Dangote, the owner of the Dangote Group, at State House in Dar es Salaam on May 16, 2026. PHOTO | COURTESY
On April 23, 2026, at a summit in Nairobi, Aliko Dangote pledged to build a 650,000-barrel-per-day refinery in East Africa, a replica of his record-breaking Lagos plant. Kenya's President William Ruto named the site:
Tanga, Tanzania's northern port. Oil from Uganda, the DRC, South Sudan, and Kenya would all be processed there, refined for the region.
To understand this story, you need to go back ten years. What we know as East African Crude Oil Pipeline (EACOP) was originally the Uganda-Kenya Crude Oil Pipeline, agreed between Kampala and Nairobi in 2015 to carry Ugandan crude to the port of Lamu. Kenya was the host and the terminus.
Then Tanzania moved and Magufuli dispatched delegations to Kampala with a sharper offer: lower transit fees, a port requiring no dredging, and a corridor clear of al-Shabaab territory.
TotalEnergies backed Tanzania. By April 2016, Uganda had abandoned the Kenya pipeline. EACOP was routed through Tanzania to Tanga and Kenya was left to build its own pipeline to Lamu, alone.
The wound has not healed.
Which is why the question most observers are asking, but not answering, is why Ruto would announce a $17 billion refinery in Tanzania at all. His own words supply the answer.
Days after naming Tanga at the Nairobi summit, Ruto acknowledged to Samia: "If I knew it would not sit well, I would have announced it in Mombasa."
He named Tanga only because the pipeline goes there. The announcement was not a gift. It was a starting position in a decade-long infrastructure rivalry, one Kenya has been waiting to reverse since 2016.
The deeper conflict in this story is not between Kenya and Tanzania. It is between Aliko Dangote and TotalEnergies and EACOP is where it will be fought.
TotalEnergies owns 62 percent of EACOP, the only pipeline capable of delivering Ugandan crude to the East African coast at scale.
The Transport and Tariff Agreement governing throughput charges is a TotalEnergies-anchored instrument. More fundamentally, EACOP is, by design, a crude export pipeline and its commercial purpose is to move Ugandan oil to the coast for shipment to international markets.
TotalEnergies, as its 62 percent majority shareholder, produces that crude upstream, earns a tariff transporting it, refines it in Europe, and sells refined product back into East Africa through its own retail network, with over 100 service stations in Tanzania and a 20 percent market share in Kenya.
It earns at every stage of that chain. A Dangote refinery processing that crude locally removes the most profitable stage entirely.
In Nigeria, Dangote already did exactly this and TotalEnergies felt it. His Lagos refinery drove TotalEnergies Marketing Nigeria to its first net loss in over two decades, stripping shareholders of dividends for the first time since 2005.
Dangote sued Nigerian regulators for deliberate sabotage of his operations; petroleum union branches inside TotalEnergies' Nigerian workforce physically cut crude supply to his refinery.
This conflict is active and does not stop at the Tanzanian border.
Any refinery developer relying on EACOP crude is commercially dependent on terms set by Dangote's most bitter corporate rival.
That is the structural fault line beneath this entire project, and it applies regardless of whether the refinery sits in Tanga or Mombasa.
On May 16, 2026, President Samia met Dangote at State House in Dar es Salaam and Tanzania came prepared. The meeting covered the refinery and Dangote praised Samia's resolution of problems at his $600 million cement plant in Mtwara, a facility now producing 2.8 million tonnes annually.
Technical teams are on the ground, and feasibility studies are formally underway, with Tanga, Mombasa, and Lamu all on the table. A competitive bid is open and Tanzania is in it.
The criteria Dangote has named are unambiguous: land, regional financing, protection against cheap fuel dumping from Russia and India, and a functioning investment climate. Kenya is moving, its National Infrastructure Fund will take an equity stake, and Ruto has committed public capital.
Tanzania's counteroffer is the EACOP terminus at Tanga, a president who has demonstrably resolved investor problems at scale, and a geography bridging EAC and SADC markets. The one asset Kenya cannot replicate is that the pipeline arrives on Tanzanian soil. What Tanzania cannot afford is to assume that is enough.
Tanzania won the pipeline in 2016 by being sharper, faster, and cheaper than a rival that assumed it had already won. The architecture for doing it again exists. What is required now is not patience, but the same thing that worked before.
Amne Suedi is the Managing Director of Shikana Investment and Advisory, Honorary Consul of Switzerland in Zanzibar, and Chair of the Switzerland-Tanzania Chamber of Commerce.
