News emerged from the “Africa We Build Summit 2026” held in Nairobi last week regarding a proposal to establish an oil refinery in Tanga. The facility would be jointly owned by oil-producing countries in the region. Questions have since been raised: How feasible is the project, what will happen to Uganda’s proposed refinery and above all, why Tanga when Tanzania does not have crude oil?
With disruptions to oil flows from the Gulf, East Africa stands at a pivotal moment in addressing its energy needs. With proven crude oil reserves in Uganda, Kenya, South Sudan, and the DRC, the region has a rare opportunity to shift from being a net importer of refined petroleum products to a producer. Currently, the region exports crude oil at around $60 per barrel and imports refined products at approximately $100 per barrel — a deficit of $40 per barrel.
A jointly owned refinery is therefore critical. No single country in East Africa has sufficient scale, capital, or market to justify a globally competitive refinery on its own. Uganda, South Sudan, Kenya, and the DRC have proven deposits of 6.5 billion, 3.5 billion, 560 million, and 180 million barrels, respectively. However, collectively, the region commands a market large enough to support a refinery in the range of 400,000–500,000 barrels per day (bpd) — an economically viable scale by international standards. This capacity would meet the region’s current and near-term demand of 350,000–420,000 bpd.
Uganda should not be concerned about its proposed 60,000 bpd refinery being developed in collaboration with the UAE. The project should proceed, as the ideal scenario for the region is a hybrid model: A smaller refinery of 60,000–120,000 bpd in Uganda, complemented by a mega-refinery in Tanga. To facilitate this, a network of pipelines will be essential. Ugandan crude oil would flow from Lake Albert to Tanga via the EACOP. A pipeline would need to be developed from South Sudan to Lake Albert to connect with EACOP. Kenya would need to construct a pipeline from the Lokichar Basin in Turkana to Lamu for onward shipment to Tanga. Similarly, a pipeline could be built from eastern DRC to connect to the EACOP network.
The success of this vision hinges not only on political will but also on execution. This is where Aliko Dangote comes in. He should be positioned as an anchor investor, lead developer, and long-term operator, given his proven experience in projects of this nature. By taking a significant equity stake, he would align his commercial incentives with the success of the refinery. As lead developer, he could mobilise financing, coordinate engineering and procurement and ensure timely delivery — areas where many public sector-led projects often struggle. As operator, he would bring the technical expertise and commercial discipline required to run a refinery efficiently in a highly competitive global market.
Finally, it should be noted that although Tanzania is not an oil-producing country, it stands to benefit substantially through port services, storage charges, shipping operations, employment opportunities, and associated economic activity. Tanzania could also acquire equity in the project and benefit from dividends.
