4 Local Content Policies Transforming the Energy Sector in the MSGBC Region

In his inaugural speech in April 2024, Senegalese President Bassirou Diomaye Faye declared that he would implement stronger protection of local content for the benefit of the national private sector. In the MSGBC region, poised for economic growth with imminent gas and oil production in Senegal and Mauritania, fostering knowledge sharing and local capacity is imperative. Government incentives and political frameworks are vital for facilitating this, necessitating strategic partnerships with international oil companies.

Senegal Establishes Local Content Policy Ahead of First Oil Production

Set to produce its first oil from Woodside’s Sangomar project in imminently and first gas from bp and Kosmos’ Grande Tortue Ahmeyim (GTA) project in Q3 2024, Senegal has implemented a national preference principle to promote local content. According to a 2021 decree, Senegalese personnel have exclusive priority for local jobs and training in any oil and gas-related projects. All job vacancies must undergo two bidding processes exclusively for nationals before being opened internationally. Local companies cannot be excluded based on the “most advantageous offer” if their price is within 10% of the lowest bid. To oversee the process, the government has established a National Committee for Monitoring Local Content, aiming to achieve 50% local content by 2030.

Mining Skill Transfer to the Oil and Gas Industry in Mauritania

To enhance local content amid the forthcoming first gas production from the GTA project in Q3 2024, Mauritanian authorities are crafting a new local content law. In 2022, the Mauritanian Ministry of Energy, Petroleum, and Mines adopted a national strategy to maximize benefits across the oil, gas, and mining sectors, focusing on goods and services provision, skills enhancement, and technology transfer. As the second-largest iron ore producer in Africa, Mauritania seeks to leverage its mining expertise, aiming to transition its skilled workforce to the oil and gas industry. Collaborating with bp, the ministry has established a distance learning center, facilitating training courses for local suppliers and technicians involved in petroleum operations.

Partnership Between Local and Public Entities in The Gambia

The Gambia is in the early stages of exploring its oil and gas potential, situated in a proven geological province. In preparation for sector development, its Petroleum Exploration, Development and Production Licenses (PEDPLs) system, established in 2015, outlines a local content strategy. This strategy involves a partnership between public and corporate entities, aiming to promote local investment and employment opportunities in exchange for national sector involvement rights. The PEDPL mandates annual meetings between government and licensees to formulate corporate social responsibility programs, requires licensees to submit detailed local content plans annually, and stipulates financial contributions to local content funds.

Local Content Plan Submission in Guinea-Conakry

Guinea, poised to launch its first license bidding round for about ten offshore blocks by late 2024, also holds significant mineral resources including bauxite, which makes up two-thirds of global reserves, and iron ore with a potential of 20 billion tons. Guinea has implemented a strong local content strategy which outlines that companies looking to enter Guinea’s extractive sector must submit a plan for sourcing local goods and services with their license applications. This strategy is reflected in the signing in October 2023 of over $120 million in new freight contracts by Rio Tinto with Guinean companies Africa Transport, AMA, and GPC for the Simandou iron ore project. Africa Transport plans to double its operational capacity with new trucks, while GPC aims to create jobs.

Explore opportunities, foster partnerships and stay at the forefront of the MSGBC region’s oil, gas and power sector. Visit www.msgbcoilgasandpower.com to secure your participation at the MSGBC Oil, Gas & Power 2024 conference. To sponsor or participate as a delegate, please contact sales@energycapitalpower.com.

 

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Onur Yilmaz

Onur Yilmaz

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