Senegal and ENI Sign Memorandum of Understanding to Evaluate Five Offshore Blocks
On Tuesday, Senegal’s Minister of Energy announced that the West African nation has entered into a memorandum of understanding (MoU) with Italian energy company ENI to conduct technical studies on five offshore exploration blocks. The agreement, which was disclosed during a press briefing in Dakar, outlines ENI’s commitment to fund the necessary geological and geophysical assessments while Senegal’s national oil company, Petrosen, will oversee the work and contribute its expertise on the country’s sedimentary basin.
Details of the Agreement
Under the MoU, ENI will bear the full cost of the technical studies, which include seismic surveys, well‑log analysis, and reservoir modelling. Petrosen will act as the local partner, providing access to existing data, facilitating permits, and ensuring that the studies align with Senegal’s national hydrocarbon policy. The five blocks covered by the agreement are located in the deep‑water portion of the Senegalese margin, an area that has shown promising hydrocarbon indications since the first major discoveries in 2014.
According to a statement released by ENI on the same day, the studies are expected to be completed within 18 months, after which both parties will evaluate the commercial viability of the blocks and discuss potential next steps, including the possibility of entering into production sharing contracts.
Broader Context: Senegal’s 2024 Licensing Round
The MoU follows Senegal’s announcement last week that it would offer 109 oil and gas blocks to both foreign and domestic investors as part of a new licensing round aimed at revitalising the upstream sector. The government’s strategy is to attract investment that can accelerate exploration, increase state revenues, and create skilled jobs for Senegalese citizens.
Key points of the licensing round include:
- A transparent bidding process overseen by the Directorate of Hydrocarbons.
- Preference for partners that demonstrate a commitment to local content and capacity building.
- Regular review of existing licences to ensure compliance with work‑program obligations.
These measures are designed to address past concerns about licence under‑performance and to maximize the socioeconomic benefits of hydrocarbon development.
Government Vision: Building Local Leadership in Oil and Gas
President Bassirou Diomaye Faye has emphasized that the exploitation of Senegal’s petroleum resources should serve as a catalyst for developing homegrown expertise in the oil and gas sector. In recent speeches, the President has stated that revenue generated from future production will be reinvested into technical training programmes, vocational schools, and research institutions focused on energy engineering.
By partnering with established international operators like ENI, Senegal aims to transfer knowledge and technology that can enable Senegalese engineers, geologists, and project managers to take on leadership roles in upcoming projects.
Challenges and Considerations
While the outlook is optimistic, several challenges remain:
- Global market volatility: Fluctuating oil and gas prices can affect the economic attractiveness of deep‑water projects.
- Environmental safeguards: Senegal has committed to adhering to international standards for offshore operations, including spill‑response planning and biodiversity protection.
- Infrastructure development: Export pipelines, processing facilities, and storage terminals will require substantial investment and coordination with regional partners.
Addressing these issues transparently will be critical to maintaining investor confidence and ensuring that hydrocarbon development contributes sustainably to Senegal’s long‑term growth.
Looking Ahead
The ENI‑Petrosen collaboration marks an early step in Senegal’s broader effort to transform its offshore potential into tangible economic benefits. If the technical studies confirm commercially viable reserves, the country could see its first deep‑water production within the next decade, potentially generating billions of dollars in revenue as projected by the World Bank’s 2023 extractive industries outlook for West Africa.
For now, stakeholders will monitor the progress of the feasibility studies, the outcome of the licensing round, and the government’s ability to balance revenue generation with environmental stewardship and local empowerment.
Sources: Senegal Ministry of Energy press release (April 2025), ENI corporate announcement (April 2025), Reuters coverage of Senegal’s 2024 oil and gas licensing round, World Bank Extractive Industries Review (2023).
