Minister says Senegal should lower its electricity rates due to gas production

Senegal's energy ministry said that the country plans to use more natural gas produced domestically to lower electricity costs. This will reduce its dependency on imported fuels, whose prices rose sharply in this year.

Senegal has seen its exports and economic growth increase since the expansion of oil and gas production. The increase in fuel subsidies is due to the soaring energy costs caused by conflict in the Middle East.

In a written response to questions, Energy Minister El Hadji Abdourahmane Diouf said Senegal’s priority is to reduce the actual cost for electricity through developing domestic natural gas and expanding renewable energy capacities.

He said that Senegal is open to new partners in order to develop its resources. Companies such as BP Kosmos Woodside have been strategic partners?who played a crucial role in the recent domestic gas discoveries and development.

The government, which took office in June, announced earlier this month that it aimed to reduce energy prices by as much as 30% through reforms of subsidies.

Diouf said that the government was shifting its focus from a broad-based subsidy to a targeted one, focusing on the most vulnerable families, public transport and strategic sectors.

He said that the goal was to increase efficiency in public spending, without reducing consumer protection. However, he added that no specific reforms had been decided.

SENEGAL 'OPEN FOR NEW PARTNERS'

Woodside Energy, an Australian company, began production in Senegal's Sangomar oil field in 2024. Gas production was also announced in early 2013 at the Greater Tortue Ahmeyim liquefied gas project operated by BP.

Before he was removed, Ousmane sonko, the former prime minister, had criticised BP's contract in March and stated that Senegal would be canceling some exploration licences.

After Sonko’s government briefly floated the idea of nationalising this field last year, Petrosen, the national oil company, received a license in April for Yakaar-Teranga, which had been operated by U.S. firm Kosmos.

In a written interview, Diouf stated that Yakaar-Teranga was a major project. Its gas would be sold both on the domestic market and exported.

He said that "Senegal is open to new partners who are able to support the development of the project, according the national interests, and in the best possible technical, economic, and commercial conditions."

Diouf said that the audits and contracts reviews initiated by the former government are aimed at strengthening governance in the sector.

(source: Reuters)