In June 2024, the first oil from the Sangomar offshore field flowed to a floating production vessel off Senegal's coast. For a country that had built its economy on tourism, remittances, and groundnut exports, the moment was historic. Senegal had joined the ranks of African oil producers, and with it, the dilemma of how to manage sudden resource wealth without repeating the failures of the past.

The Sangomar field, developed by Woodside Energy of Australia, has initial production capacity of 100,000 barrels per day, with the offshore Greater Tortue Ahmeyim LNG project, shared with Mauritania, expected to add significant gas revenues from 2025. At current oil prices, Senegal stands to earn $1.5-2.5 billion annually in government revenues from these two projects alone, a 40-60% increase on current total government revenues.

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The Resource Curse: Africa's Cautionary History

Angola, Nigeria, Equatorial Guinea, and Gabon have all experienced the paradox of abundant oil wealth coexisting with widespread poverty, weak institutions, and economic volatility tied to commodity price cycles. The mechanism is well-understood: oil revenues crowd out other economic activities, overvalue the currency, create rentier politics, and generate inequality without broad-based development.

Senegal's new president, Bassirou Diomaye Faye, elected in March 2024, has made transparent resource management a signature commitment. His government has established an independent oil fund modelled on Norway's Government Pension Fund, with explicit rules on savings rates, investment criteria, and public reporting.

Local Content Requirements

Senegal's petroleum law mandates significant local content in oil and gas operations, from employment of Senegalese nationals to procurement from local suppliers and use of Senegalese service companies. The Société des Pétroles du Sénégal (Petrosen) has established a local content monitoring unit with real enforcement capacity.

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