Senegal says oil, gas and mine contracts will be reworked if needed

The Yakaar-Teranga field offshore Senegal. Stock image.

Senegal’s new Energy and Mines Minister said on Thursday the government would renegotiate oil, gas and mining contracts if necessary once a promised audit is completed.

President Bassirou Diomaye Faye, who defeated the ruling coalition candidate in a landslide election victory last month, announced the audit after his inauguration on April 2, assuring investors they were still welcome in the West African country.

In some of his first remarks since his appointment last week as energy and mines minister, Birame Souleye Diop said closer scrutiny of the sectors was high on the agenda for Senegal, which is due to start oil and gas production this year.

This will involve “publishing the contracts, carrying out a mining audit, working in the interests of the people and, if necessary, renegotiating all existing contracts,” he said.

Companies involved in the sector include BP and US-listed Kosmo Energy, which are leading the development of Greater Tortue Ahmeyim, Senegal’s first LNG project.

Australia’s Woodside Energy holds 82% of Senegal’s offshore Sangomar oil and gas field, which is expected to start oil production in mid-2024.

“We will strive to promote resources to our partners in a way that is strictly in line with the interests of the Senegalese public,” Diop added in a local radio interview.

Diop’s comments suggest Faye’s new coalition government is willing to push ahead with some of its more radical campaign promises, which included the renegotiation of such contracts with foreign operators in Senegal.

The policy contrasts with the more investor-friendly approach of Faye’s predecessor Macky Sall, whose ambitious infrastructure-focused strategy failed to create enough jobs and alleviate Senegal’s rising cost of living.

The International Monetary Fund (IMF) has forecast that Senegal’s upcoming oil and gas production will boost economic growth to double digits next year.

(By Diadie Ba and Sofia Christensen; Editing by Alessandra Prentice and Alexander Smith)


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