Senegal starts producing oil as president promises benefits
Senegal's president has promised to renegotiate oil and gas contracts
- Published
Senegal's President Bassirou Diomaye Faye has said profits from the sale of oil and gas will be 鈥渨ell managed鈥 as the West African state started producing oil for the first time.
Australian energy giant Woodside described the extraction as a 鈥渉istoric day鈥 and a "key milestone" for the company and the nation.
The Sangomar deep-water project, which also has gas, aims to produce 100,000 barrels of oil per day.
It is expected to generate billions of dollars for Senegal and boost its economy.
Thierno Ly, the general manager of the national oil company Petrosen, said the nation had entered a 鈥渘ew era鈥 when production began on Tuesday.
"We have never been so well positioned for opportunities for growth, innovation and success in the economic and social development of our nation," he said.
Petrosen has an 18% stake in the project while Woodside owns the remainder.
Mr Faye, who was elected president in April, has been keen on renegotiating the deal as part of reforms he promised during the election campaign.
Speaking to students on Tuesday, he said that the earnings would be "well managed", and that an 鈥渋nter-generation fund鈥 had been set up for the benefit of "your generation and those to come鈥, the AFP news agency quoted him as saying.
Senegal鈥檚 move to renegotiate oil and gas contracts has been seen by some analysts as making investors jittery, but government supporters say it is vital for the West African state to increase its stake in projects so that the nation benefits from its natural resources.
Prime Minister Ousmane Sonko, a former opposition politician who was a key figure in the president鈥檚 election campaign, recently insisted that contracts signed by previous administrations were 鈥漸nfavourable鈥 to the country, and would be reviewed.
"We're the ones who promised you we'd renegotiate the contracts, and we're going to do it. We've started already,鈥 the AFP quoted him as saying in an address to young people on Tuesday.
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