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Senegal set to become a large-scale natural gas producer

Published on: 30-Oct-2017

“By 2021 we should start with the exploration of gas, while in 2022 oil should follow,” said Mamadou Fall Kane, Senegal’s presidential advisor on oil and gas.

Mr. Fall Kane shared his thoughts during a knowledge-exchange visit to The Netherlands, organised by NABC, mid-October. Traveling with a delegation of 10 high-profile Senegalese, representing (state) oil & gas companies, as well as government officials, the group paid visits to both the Dutch companies active in Oil and Gas extraction as well of the regulatory bodies involved.

The Netherlands found large quantities of gas in the 1950’s, over half a century before Senegal discovered exploitable  gas fields in 2014. “I am quite impressed by how Holland developed its strong off-shore industry,” said Mr. Fall Kane. “The country managed to use their natural gas as a source of wealth creation and of employment. Since we are on the eve of having our own offshore industry, Senegal can learn from this experience. We can learn lessons from the past, but also be aware of which mistakes to avoid. It is very important for us to use the income from the natural resources beneficial for the country. Wealth creation, social development and employment are the most important areas.”

The Senegalese delegation is accompanied by representatives from RVO (the Dutch Enterprise Agency), that commissioned this visit, as well as the Dutch embassy in Dakar, who initiated it. The visit has been carried out by the Netherlands-African Business Council. Although both oil and gas have been found, much focus in is on the gas since the quantities found so far are much higher. The reserves confirmed are the largest on the western side of the African continent.

“Senegal finds itself in the same position as The Netherlands was 60 years ago,” said Theo Peters, the Dutch ambassador to Senegal. The gas presents a huge opportunity for the country, but we should not be underestimate the risks that come with exploration as well.”

All aspects covered

During five intensive days, the delegation linked up with myriad players from the Dutch oil and gas sector. Apart from the leading companies, active in extracting and offshore services, the group spoke to all ministries concerned with sector, met with tax authorities, legal advisors, and various knowledge institutions. But they also visited the DCV Aegir, a giant ship that lays pipes for the sector, and saw where Liquefied Natural Gas (LNG) arrives in The Netherlands by ship, destined for distribution throughout Europe. On their last day, the delegations visited the Dutch offshore supply base at Den Helder, as well as a company specializing in treating polluted soil that comes with extraction.

“It is very important to do follow-up on this mission,” ambassador Peters said. Some of the institutions that we have visited in The Netherlands are willing to come to Senegal. We are now planning to organize a masterclass in Dakar, so that knowledge exchange continues in Senegal as well.”

Aid and trade agenda

The cooperation with Senegal fits in the Dutch aid and trade agenda, according to ambassador Peters. “It is two-fold. On the one hand, we are sharing our knowledge and best practices. On the other hand, we do also hope that Dutch companies can eventually play a role in the Senegalese gas sector. We are already seeing that some agreements are being discussed.”

Apart from combining aid and trade, the ambassador also faces the arduous task to combine Dutch climate policy –according to the Paris accords of 2015 the world needs to phase out fossil fuels- with supporting an upcoming gas industry. “Sometimes it may seem a bit contradictory,” the ambassador admits. “One the one hand, The Netherlands is strongly committed  to  ‘Paris’ but on the other hand we as ambassadors need to support Dutch companies, some of which happen to have a lot of expertise in oil and gas. All the experts say that even while trying to phase out, fossils will still be needed for the next 30 or 40 years. So with this resource having been found in Senegal, I can understand that they want to use their resources to uplift the wellbeing of their people, just like The Netherlands did. Therefore we try to help them to do this in the most sustainable way possible. We have offered Senegal our help in getting a handle on the risks and ‘negative externalities’ and show them how we, as a government, have tried to do that in the Netherlands over the last decades. It is a two-track approach, helping the Senegalese government ànd helping Dutch companies. ”

The ambassador mentions how currently, a lot of the electricity in Senegal is generated by diesel-consuming generators, putting a heavy constraint on the environment. Switching these generators to gas would be a solution significantly reducing Senegal’s CO2 footprint. The introduction of Gas to Liquid technology would be another –fossil, but less polluting- option.

Crucial decision ahead

Mamadou Fall Kane, the President’s special advisor on oil and gas, is a busy man. Not only Dutch companies are vying for contracts, the whole world is interested. Companies involved in extraction include giants like TOTAL, BP and Kosmos. “A number of others are knocking on the door,” Mr. Fall Kane said. Some crucial decisions are going to be made in the months ahead. “We want to work with many of the different companies, not only with just one of them,” said Mr. Fall Kane.

Meanwhile, ambassador Peters thinks that whoever will be tasked to do the exploitation, the Dutch private sector is in a good position to acquire contracts. “Since many of them are suppliers to the upstream (extracting) companies, there is a good chance they will get involved,” the ambassador concluded. 

Text and photos: Arne Doornebal

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