Australian oil and gas company, Woodside Energy, has initiated international arbitration proceedings against the Senegalese government over a tax related disagreement tied to the Sangomar oil field.
The dispute, filed on May 30, was lodged with the International Centre for Settlement of Investment Disputes (ICSID), with Senegal’s Ministry of Oil and Energy named as the respondent, according to ICSID’s publicly available records.
Woodside, which began production from the offshore Sangomar field in 2024, stated that it had complied fully with Senegalese regulations, its production sharing contract, and the host government agreement.
“Woodside strongly believes we have acted in accordance with applicable regulations, the Sangomar production sharing contract and the host government agreement, and there are no outstanding taxes payable,” the company stated in a response to media questions.
It, however, declined to offer further details on the case or its expectations.
An official at Senegal’s Ministry of Oil and Energy could not be reached for comment when contacted outside normal working hours.
The Sangomar field, Senegal’s first offshore oil development, is a major milestone in the country’s efforts to boost its energy independence and generate revenue from natural resources.
However, the project has come under increased scrutiny amid President Bassirou Diomaye Faye’s anti corruption and resource accountability drive.
In recent months, the Senegalese government has reviewed several oil and gas contracts as part of efforts to ensure that existing deals reflect the country’s economic interests.
Local media have reported rising political pressure on foreign firms to increase transparency and tax compliance.
The Sangomar project is operated by Woodside with a majority stake, while Senegal’s state owned oil company, Petrosen, holds the remaining interest.
Although arbitration does not immediately halt production, it could complicate relations between Woodside and Senegalese authorities, especially as the country seeks to expand foreign investment in its emerging oil and gas sector.
The ICSID case is still at a preliminary stage, and no hearing date has been set.
Arbitration under ICSID is a standard procedure for resolving disputes between investors and host states under bilateral or multilateral agreements.
As the case unfolds, stakeholders in both the public and private sectors are closely watching how Senegal balances investor confidence with its push for greater fiscal benefits from natural resource development.
