As the body promoting Senegal's hydrocarbon sector, the state-owned oil and gas producer Société nationale des pétroles du Sénégal (PETROSEN) has seen a dramatic increase in international interest in the country's oil resources. Mamadou Faye, Managing Director of PETROSEN, explained how PETROSEN is the instrument for implementing the State of Senegal's oil policy.
To what extent do the various government institutions - Cos-Petrogaz, PETROSEN, INPG - complement each other in realizing President Macky Sall's vision for the oil and gas sector?
Several key institutions are involved in Senegal's oil and gas sector, including the Comité national d'orientation stratégique pour le pétrole et le gaz (Cos-Petrogaz), the Ministry of Oil and Energy, the Ministry of Finance and Budget, the state-owned oil company PETROSEN. and the Institut national du pétrole et du gaz.
The Cos-Petrogaz, which reports directly to the President of the Republic of Senegal, is a strategic management and oversight body. Its mission is to assist the President of the Republic and the government in defining the overall strategy for the hydrocarbons sector, and to monitor its implementation, through the permanent secretariat, which serves as a coordination tool.
The Ministry of Petroleum and Energy is the official supervisory body responsible for drawing up and implementing the policy defined by the Head of State in the energy sector. In particular, it controls and monitors oil operations.
PETROSEN is in charge of the following operations: sedimentary basin development, exploration and production of hydrocarbon resources, refining, storage, marketing, transport and distribution, as well as industrial activities related to the segments listed above.
Finally, the Institut National du Pétrole et du Gaz aims to develop national oil expertise and promote employment for Senegalese in the oil and gas sector.
Senegal has made major oil and gas discoveries in recent years, and exploration continues. Although first production is expected in 2022, the government has decided to anticipate several segments of the energy and oil sector.
Prior to these discoveries, Senegal had decided to join the Extractive Industries Transparency Initiative (EITI), a global initiative aimed at increasing transparency in the mining and oil sectors. PETROSEN has a representative on the national EITI committee.
Can you give us some details on the strategy for exploiting the first resources extracted by 2022?
Oil and gas production is scheduled to begin in 2022. In the case of oil, part of the production will be used for the domestic market, i.e. sold to and refined locally by Société Africaine de Raffinage, Senegal's refinery. In the short term, it is planned to increase SAR's capacity through a plant modernization program, from 1.2 million tonnes per year to 1.5 million tonnes per year. However, the government is considering the construction of a new refinery, with increased capacity, capable of refining complex crudes.
For natural gas, a monetization master plan is currently being drawn up. In addition, the Ministry of Petroleum and Energy has set up a "Gas-to-Power" strategy for the production of low-cost electricity using natural gas as a raw material. In short, in addition to producing LNG for export, the gas will be used primarily for power generation, but options for processing into fertilizers and other by-products are also being considered.
What is Senegal's strategy for allocating offshore blocks currently open to exploration? Are you planning to launch a series of official licenses?
A dozen offshore blocks are currently open. They include new ultra-deep offshore blocks. In line with the new oil code introduced earlier this year, we will launch a formal licensing cycle for these blocks. The announcement will be made at the Africa Oil and Power conference, to be held on October 9, 2019 in Cape Town, South Africa. The process will take six months, during which interested companies will have access to a dedicated computer room to acquire and interpret data and submit applications for the blocks of their choice.
Senegal is a stable, democratic country. It has a growing economy and strong institutions. In the oil and gas sector, discoveries made between 2014 and 2017 have been instrumental in proving that the country has an offshore hydrocarbon province. These two factors combined mean that foreign investors and operators see Senegal as a safe and attractive country in which to do business.
