Senegal: Senegal Begins Review of Oil and Gas Contracts in Bid to Reclaim Resources

Senegal has launched a major effort to reclaim control over its oil and gas resources, setting up a commission to review and renegotiate contracts with foreign companies that critics say have long favoured international interests over national ones.

Prime Minister Ousmane Sonko announced the move as part of the government’s broader push to ensure that Senegal’s newfound energy wealth benefits its people, fulfilling a key campaign promise made by President Bassirou Diomaye Faye and Sonko.

The commission, comprised of legal, tax and energy sector experts, was officially established on Monday.

It will scrutinise contracts in Senegal’s oil, gas, and mining sectors to identify areas where terms can be renegotiated in favour of the national interest. The commission has the authority to bring in additional expertise from abroad if necessary.

This move follows President Faye’s landslide election victory, in which he promised to audit and, if needed, renegotiate contracts with foreign operators in strategic sectors.

While details of the audit and any specific renegotiation plans have not been disclosed, the establishment of this commission marks a significant step towards fulfilling that commitment.

Promises

Sonko emphasised the government’s dedication to honouring its pledge to the Senegalese people.

“As an opposition political party, we vigorously denounced the way in which agreements and conventions were concluded to the detriment, most of the time, of the strategic interests of Senegal and its people,” Sonko said.

Now in power, he promises to do better.

He said the commission will have sufficient resources to look into the contracts and hire experts from abroad if necessary.

The commission’s work comes at a pivotal time for Senegal, which became an oil producer for the first time earlier this year.

Australia’s Woodside Energy announced in June that its Sangomar oil and gas field had produced its first oil in Senegal.

Additionally, gas production is expected to begin by the end of the year at the Greater Tortue Ahmeyim (GTA) liquefied natural gas (LNG) project, operated by BP.

Despite the commission’s formation, Sonko did not specify how long the contract review process would take.

Challenges

Former Senegalese MP Oumar Sy praised the decision to renegotiate the contracts but cautioned that it could be a lengthy and challenging process.

“These types of contracts are very heavy and hard to change. It might take years to do so,” Sy told RFI in Dakar.

In addition to the contract review, Sonko also announced plans to develop a restructuring and reconfiguration plan for the Port of Dakar, further indicating the government’s focus on strengthening national control over key resources and infrastructure.

This latest move follows another milestone for Senegal: the launch of its first satellite from California last Friday.

The satellite launch makes Senegal one of 12 African nations with their own surveillance and telecommunications satellites in space, a development that Faye hailed as a major step towards the country’s “technological sovereignty”.