Dangote’s $16bn Kenya refinery creates 1million-tonne cement opportunity for local rival

Dangote’s $16 billion Kenya refinery is opening up a potential 1 million-tonne cement and concrete market for a local manufacturer, giving Bamburi Cement an opportunity to participate in one of the country’s biggest industrial projects.

• Dangote's $16 billion Kenya refinery project is creating a potential market for over 1 million tonnes of cement and concrete.
• Local cement producer, Bamburi aims to supply its specialty products to the refinery, leveraging its Mombasa plant for site deliveries.
• Bamburi is promoting its locally manufactured cement and innovative concrete solutions for the project's large-scale and marine construction needs.
• The deal highlights opportunities for domestic suppliers as Kenya encourages use of local products.

Bamburi is pursuing a commercial opportunity to supply more than one million tonnes of cement and concrete products for the planned Dangote East Africa Petroleum Refinery in Lamu, according to The Eastleigh Voice.

The company expects its Mombasa plant to support deliveries to the refinery site.

The opportunity highlights how Dangote’s entry into Kenya’s energy sector could create business for local manufacturers, even though Dangote Cement already has a significant manufacturing presence elsewhere in East Africa.

DON'T MISS THIS: Africa’s richest man plans to buy ships after struggling to move cement from Nigeria to Ghana

Bamburi targets Dangote’s construction demand

Bamburi CEO Geoffrey Ndugwa said the civil and related construction works for the 700,000-barrel-per-day refinery are expected to consume approximately one million tonnes of cement and concrete solutions.

“We are well positioned to manufacture and deliver to the project site from our Mombasa plant,” Ndugwa said, according to KBC.

Bamburi is proposing its locally manufactured DuraCem Cement, a 42.5-grade speciality product designed for large-scale and marine construction, alongside its Ultra-series concrete products. These include waterproof, self-compacting, pervious and fibre-reinforced concrete.

The proposed contract also comes as Kenya pushes for locally manufactured products to be used in the Sh2 trillion refinery project, potentially creating opportunities for other domestic suppliers beyond cement.

Dangote’s Kenya gap

Dangote Cement already operates a 3 million-tonne-per-year integrated plant in Mtwara, Tanzania, and a 2.5 million-tonne plant in Ethiopia.

DON'T MISS THIS: Africa’s largest cement maker posts $730m profit, raises dividend 50%, expands in South Africa, Ethiopia

Its current operations page lists manufacturing or other cement operations across 11 African countries, while Kenya is identified among its eastern and southern African markets with existing or planned operations.

That makes the Bamburi opportunity notable: the Nigerian group is bringing its refinery investment into Kenya, while a Kenyan cement manufacturer is positioning itself to supply part of the construction materials needed to build it.

DON'T MISS THIS: Africa’s wealthiest billionaire expands energy empire with $16bn Kenya refinery as “enormous” demand hits his $1.6bn IPO

The refinery broke ground in Lamu on September 30 and is designed to process 700,000 barrels of crude oil per day. Reuters reports that the facility is expected to serve fuel markets across East Africa and is scheduled for completion in 2030.

For Bamburi, the potential deal could also coincide with an expansion of its own production capacity. The company has a $250 million engineering, procurement and construction contract with Sinoma CBMI Construction for a new clinkerisation plant in Matuga, Kwale County, with annual clinker capacity of 1.6 million tonnes, according to The Eastleigh Voice.

The proposed cement deal therefore offers an early example of how Dangote’s Kenyan refinery could generate opportunities for East African businesses before the facility begins producing fuel.