Ruto downplays rivalry over oil refinery in East Africa

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President William Ruto has played down suggestions of rivalry between Kenya, Uganda and Tanzania over competing refinery projects, saying East Africa’s growing demand for petroleum products can support several facilities across the region.

Speaking during a media interview at State House Mombasa, Ruto said Kenya had no objection to Uganda and Tanzania pursuing their own refinery projects, arguing that the different facilities could complement rather than compete with one another.

“There is no bad blood at all. There is no problem,” Ruto said.

His remarks came a day after he presided over the groundbreaking of the Lamu refinery project, which the government is positioning as a major component of a wider industrial complex on the Kenyan coast.

Ruto said he had discussed Uganda’s plans with President Yoweri Museveni and agreed that Kampala could proceed with a smaller refinery without threatening Kenya’s investment in Lamu.

He said Kenya would even be prepared to buy petroleum products from Uganda if they could reach the Kenyan market at competitive prices.

“If it is manufactured there in Uganda and the oil from that place is near Busia, and it can reach Busia at a lower price, we will buy oil from anywhere and bring it to Busia,” Ruto said.

The President argued that the size of the regional petroleum market meant there was room for more than one refinery.

“This one in Lamu cannot serve all of us; it will be necessary to expand,” he said, adding that East Africa had “enough opportunity” for multiple facilities.

Ruto also extended the same approach to Tanzania, saying Kenya could participate in a refinery project in Tanga if it is eventually developed.

“Even if the one in Tanga is built, we as Kenya will go and buy some shares there. There is no problem,” he said.

The comments point to a regional energy market in which petroleum products could move across borders depending on availability, transport costs and prices. Rather than treating refinery projects as competing national investments, Ruto said the facilities could strengthen economic cooperation within the East African Community.

The President said the Lamu refinery would also address some of the challenges Kenya faces from dependence on imported refined petroleum products.

“Lamu will give us an opportunity to have fuel without the fluctuations that we have now,” he said.

He linked the proposed refinery to the need to reduce Kenya’s exposure to international oil price shocks, disruptions caused by instability in oil-producing regions and costs associated with transporting petroleum products over long distances.

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Ruto said local refining could reduce expenses related to insurance and transportation while providing Kenya with greater access to locally processed fuel.

However, he said the larger economic opportunity would extend beyond the refinery itself. The government plans to develop industries around the facility, including petrochemical, chemical and plastics manufacturing.

The refinery could also provide raw materials for industries producing fertiliser and bitumen, potentially reducing reliance on imports of some petroleum-based products.

The broader development is expected to create opportunities for employment, investment and trade while strengthening Lamu’s position as an industrial and logistics centre.

Ruto said Kenya’s policy would be guided by competitiveness, allowing businesses and consumers to obtain petroleum products from whichever regional facility can supply them efficiently and at favourable prices.

The President maintained that Kenya, Uganda and Tanzania therefore did not need to view their refinery plans through the lens of rivalry.

Instead, he said, multiple facilities could create a larger and more integrated petroleum market capable of serving the needs of East Africa.