Senegal’s Oil Production Surge Promises Economic Transformation

Senegal’s Oil Production Surge Promises Economic Transformation

Senegal’s Sangomar offshore oil field has achieved a significant milestone, producing 9.1 million barrels in the second quarter of 2025, marking the country’s successful entry into the ranks of oil-producing nations. The field produced 3 million barrels in April, 3.1 million in May, and 3 million in June, demonstrating consistent output levels.

The project, operated by Australia’s Woodside Energy (82%) with Senegal’s national oil company Petrosen (18%), is forecast to produce 30.53 million barrels of crude oil this year, sustaining a rate of around 100,000 barrels per day. The $5 billion development started production in mid-2024 and has already begun delivering significant economic benefits.

Woodside Energy recently reported an 8% rise in Q2 revenue to $3.28 billion, with the Sangomar project contributing $510 million to the company’s earnings. The project averaged 55,000 barrels per day during its first year of operation.

Petrosen forecasts the hydrocarbons sector to generate more than $1 billion annually over the next three decades. Direct fiscal flows from export earnings, corporate taxes, royalties, and production sharing are expected to inject $2 billion to $4 billion into public coffers over the project’s lifetime. The government has intensified efforts to build downstream capacity, including modernizing the state-owned Société Africaine de Raffinage refinery to process up to 5 million tons of oil per year by 2030. Additionally, Moroccan group Akwa will build a storage facility in Bargny Sendou, located about 30 kilometers from Dakar.

Under Senegal’s 25-year economic and social development plan, the government aims to channel oil revenues toward reducing the fiscal deficit to 3% of GDP, sustaining an average annual growth rate of 6.5%, and strengthening energy independence. The administration has launched audits of existing oil, gas, and mining contracts and is designing a stabilization fund to manage revenue flows across generations.

Source: energycapitalpower.com