Senegal joins the club of oil-producing countries Economy

Oil production has begun on the first offshore platform in Senegal, Australian operator Woodside Energy announced on Tuesday, joining the club of crude oil producing countries.

“This is a historic day for Senegal and Woodside,” said the company's CEO, Meg O'Neill, considering the extraction of oil from the Sangomar field an “important milestone.”

The floating platform is located about 100 kilometers offshore and has a storage capacity of 1.3 million barrels, according to Woodside.

The project aims to produce 100,000 barrels of oil per day. The field also contains natural gas.

Woodside's share in the deepwater project is 82%, while the Senegalese company Petrosen owns the remaining percentage.

The Sénégal officialises their entry into the petroleum product company's pay https://t.co/uwQjApZVq5

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Senegal also has a liquefied natural gas project on its border with Mauritania, which may begin production in the third quarter of this year. The British energy giant BP is contributing to the project.

While Senegal's fossil fuel production is not expected to be as large as major producers such as Nigeria, it is hoped that the oil and gas sector will generate billions of dollars in revenue and contribute to accelerating the transformation of this country's economy.

Huge wealth

The period between 2014-2017 recorded the peak of oil and gas discoveries in the territorial waters of Senegal, after huge reserves were discovered that attracted offers from foreign investment companies.

The joint offshore “Turtlefa-Ahmim” field with Mauritania is one of the most important projects, with reserves estimated at about 100 trillion cubic feet of gas, and an expected annual production capacity of about 2.5 million tons of liquefied natural gas in its first phase.

Upon completion of the second phase of field development – expected between 2027-2028 – annual production will rise to 3 million tons annually, after which it will continue on an upward production path, according to official estimates.

As for the Sangomar field, the average volume of oil production is estimated at about 100 thousand barrels per day, and it contains gas reserves ranging from 60 to 100 million cubic feet.

It is expected that production of between 60-90 million cubic feet per day of natural gas will begin between 2026-2027. This field will operate supported by a floating production and storage platform bearing the name of the first President of Senegal, Leopold Sédar Senghor.

The Yakar Teranga basin represents the third jewel in Senegal's underground wealth, with reserves estimated at about 140 billion cubic meters of gas.

According to the plans of the government of former President Macky Sall, gas production will be allocated primarily to the local market and to strengthening energy networks.

Senegal also possesses mineral reserves, most notably titanium, with revenues reaching more than $157 million in 2022, and gold, with exports exceeding $960 million annually, while zircon exports recorded approximately $112 million.

The mining sector is the second source of foreign currency and constitutes approximately 20% of the country’s total exports, with a margin of movement of a few points up and down, according to unofficial figures.