With BP gone and Kosmos’ contract expiring, Senegal is quietly positioning itself as the sole shareholder of a project that could end its $1 billion annual subsidy bill
Senegal’s state oil company has confirmed that the offshore Yakaar-Teranga gas discovery will cost $7.5 billion to develop — a project that officials say could sharply cut the country’s $1 billion-a-year energy subsidy burden and help replace imported fuels once production begins.
Mouhamadou Diop, Chief Executive Officer of Petrosen’s trading arm, set out the project’s scope at an event in Dakar, outlining a two-phase development strategy. The first phase, costing approximately $2.5 billion, would produce around 300 million cubic feet of gas per day for the domestic market. A subsequent downstream phase, requiring about $5 billion, would encompass fertiliser, petrochemical, steel and cement production to further industrialise the country’s energy sector.
The offshore field was discovered by Kosmos Energy Ltd. a decade ago and, alongside the Grand Tortue Ahmeyim gas deposit, drew wide international attention to Senegal as a promising new producer. BP Plc was an early development partner but exited the project in 2023. With Kosmos’ contract due to expire in July, Senegal is expected to become the sole shareholder — a move consistent with a broader African trend toward tighter state control of natural resources.
“We produce oil, but we remain a net importer of refined petroleum products. The goal is to use revenues from oil and gas to invest in exploration, to be an operator and develop the project ourselves,” Diop said.
Senegal plans to fund the development through regional bond markets, development finance institutions and diaspora-linked capital, with Diop noting that offtake contracts spanning 15 to 20 years could support investment-grade project debt. The project follows the country’s successful entry into oil production with the offshore Sangomar field, which began output in 2024.
Sources: worldoil.com