Aliko Dangote’s indication that he may favour Mombasa, Kenya, over Tanga, Tanzania, for his planned 650,000-barrel-per-day refinery has unsettled many in Dar es Salaam.
It should. But this is not about prestige, rivalry, or national pride. It is about something far more important: whether Africa will continue exporting raw materials and importing finished products at a premium, or finally begin adding real value at home.
Tanzania’s response so far has been too cautious and insufficiently strategic. Instead of clearly presenting why Tanga is the strongest choice, the debate has drifted into complaints and emotion.
Yet the stakes extend far beyond Tanzania and Kenya. This refinery could reshape industrial development across both the East African Community (EAC) and the Southern African Development Community (SADC). On the fundamentals, no location in East Africa matches Tanga.
A refinery with a capacity of 650,000 barrels per day would transform the region’s energy landscape. It could produce more than 40 million litres of petrol daily, alongside over 20 million litres of diesel and nearly 23 million litres of kerosene and aviation fuel, in addition to products such as LPG and heavy fuel oil.
That scale matters because East Africa remains heavily dependent on imported petroleum products. In the 2023/24 period, Tanzania imported approximately 4.31 billion litres for domestic consumption and another 4.91 billion litres for transit markets.
Kenya imported around 9.1 billion litres over the same period for both local and regional demand. Combined, these figures indicate a regional consumption market of roughly 40 million litres per day, with demand continuing to grow.This is why the refinery is such a strategic opportunity.
Tusijidanganye — let us not deceive ourselves. A project of this magnitude would strengthen regional energy security, reduce dependence on imported fuel, and ease pressure on scarce foreign exchange reserves, as petroleum imports account for a substantial share of foreign currency expenditure, leaving economies vulnerable to global energy crises.
Africa’s Long Dependence
For decades, African economies have remained trapped in the same cycle: exporting crude oil, minerals, and agricultural commodities, only to import refined and manufactured products at far higher prices.
The result has been chronic pressure on foreign exchange, weak industrial growth, and continued dependence on external supply chains.
Dangote’s refinery in Lagos, Nigeria has demonstrated that another path is possible. Built with African capital and ambition, it is now the world’s largest single-train refinery.
It has reduced Nigeria’s dependence on imported fuel, supported foreign exchange stability, created thousands of jobs, and positioned the country as a net exporter of refined petroleum products and fertiliser.
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Recent figures from the Nigerian Midstream and Downstream Petroleum Regulatory Authority show the refinery reaching output levels of more than 40 million litres per day, significantly reducing fuel imports into Nigeria.
That achievement is historic. One African entrepreneur has eased pressure on one of the continent’s largest economies and demonstrated the power of value addition.
At a time when wars, shipping disruptions, and volatile global markets continue to expose the risks of import dependence, East Africa should seize this opportunity to build its own refining and industrial capacity.
Why Tanga Still Makes Strategic Sense
The argument for Tanga is not sentimental. It is grounded in geography, economics, and long-term regional strategy.
First, the East African Crude Oil Pipeline (EACOP) already terminates in Tanga. That structural advantage cannot easily be replicated elsewhere. Refining crude at the pipeline’s endpoint is the most logical and cost-effective arrangement.
Second, Tanga occupies a unique position between two of Africa’s most important fuel distribution corridors. Dar es Salaam currently handles roughly nine billion litres of fuel transit annually for Tanzania and neighbouring countries, while Mombasa serves a similarly large northern corridor market. A refinery in Tanga could efficiently supply both systems.
To the north, a relatively short products pipeline connecting Tanga to Mombasa could integrate directly into networks serving Uganda, Rwanda, Burundi, South Sudan, and eastern Democratic Republic of Congo.
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To the south, the existing TAZAMA pipeline already links Tanzania to Zambia ending near southern DRC, supplying a significant portion of Zambia’s diesel demand. A future connection between Tanga and Dar es Salaam would extend refinery access deeper into Southern Africa, including Zambia and Malawi.
No other location offers such direct access to both EAC and SADC markets simultaneously.
Land availability also strengthens Tanga’s case. Large-scale industrial land acquisition in Kenya is often slowed by high compensation costs and lengthy legal processes due to predominantly private ownership structures. Tanzania, by contrast, can allocate strategic land more quickly and at lower cost for nationally significant infrastructure projects.
Importantly, a refinery of this size is not merely about petrol and diesel. It becomes the foundation for wider industrialisation: petrochemicals, fertiliser production, plastics manufacturing, engineering services, logistics, and technical skills development. The economic multiplier effects would extend across the region and create thousands of jobs.
The Real Barrier
The greatest obstacle is not engineering or financing. It is political and commercial resistance.
The biggest obstacle is not technical or financial. It is political and commercial. Powerful import networks in both Tanzania and Kenya profit from bringing in refined fuel — sometimes dumped cheaply from Russia, India, or elsewhere — and selling it at high margins. Local refining threatens their comfortable business model. That is why they resist it so strongly.
Dangote faced similar opposition in Nigeria but persisted. He has repeatedly argued that no refinery can survive without protection against unfair fuel dumping practices.
If East Africa truly wants industrialisation, governments must be prepared to support strategic industries. That means offering competitive land terms, mobilising regional financing, improving infrastructure, and ensuring fair market conditions for local refining.
Without that commitment, the project may never materialise.
A Strategic Decision for the Region
This debate is about more than one refinery. It is about the future direction of African economies.
Will East Africa remain primarily a transit market for imported goods and raw materials, or will it become a centre of production, manufacturing, and industrial power?
The global economy is changing. Supply chains are becoming more regionalised. Energy security is increasingly tied to national resilience. Countries that refine, manufacture, and add value domestically will be stronger in the decades ahead.
READ MORE: Ambition and Alignment: Unlocking Tanzania’s Fuller Potential
Tanzania should therefore stop reacting defensively and start leading strategically. Tanga should be presented not simply as a Tanzanian port city, but as the natural energy and industrial gateway connecting East and Southern Africa.
The government should offer Dangote a practical and competitive investment framework, shield the project from entrenched cartel interests, and position the refinery as a catalyst for regional industrial transformation.
Africa’s future will not belong to economies that only import and consume. It will belong to those that refine, manufacture, and create value.
Dangote has already shown what is possible. The remaining question is whether East Africa has the vision and determination to follow.
Zitto Ruyagwa Z. Kabwe is a Tanzanian politician and the former Party Leader of ACT Wazalendo. He served as a Member of Parliament and Shadow Finance Minister, and Chairperson of the Public Accounts Committee of the Tanzanian National Assembly (Bunge). He is available at zitto_kabwe@outlook.com. These are the writer’s own opinions and do not necessarily reflect the viewpoints of The Chanzo. Do you want to publish in this space? Contact our editors at editor@thechanzo.com for further enquiries.
One Response
As an observer of international trade, I find the argument for Tanga strategically sound. The maritime sector is increasingly moving toward ‘Port-Centric Manufacturing’ (PCM). Placing a 650,000 bpd refinery in Tanga creates a massive maritime industrial cluster that benefits from:
Lower Transaction Costs: Utilizing the EACOP infrastructure directly.
Market Depth: Simultaneous access to the SADC (via TAZAMA/Central Corridor) and the EAC (via the Northern link).
Industrial Multipliers: The transition from a transit economy to a production economy via petrochemical derivatives.
Zitto Kabwe is very correct: the biggest hurdle is often ‘incumbent inertia’ from existing import cartels. For Tanzania to ‘win,’ it must offer a regulatory environment that prioritizes regional energy sovereignty over short-term trading margins. Tanga isn’t just a Tanzanian asset; it is a regional strategic necessity.