Senegal and its natural riches: a treasure under our feet... but at what price?

Reading time: 8 minutes

A wealth that goes through the cargo

A September morning in Kédougou. The sun lights up the hills where, with bare hands, goldsmiths seek a few grams of gold.

Several hundred kilometres away, at the port of Dakar, sealed containers loaded with minerals board Asia and Europe.

Even further away, off Sangomar, an oil rig continuously pumps thousands of barrels a day.

These scenes summarize the situation in Senegal: a country sitting on a natural treasure, but most of its value leaves the almost raw territory, to be transformed elsewhere.

The promise of development is real, but it faces a central question: Will this wealth benefit the Senegalese people or will it slip between their fingers?

An inventory that impresses... on paper

Kédougou gold: economic engine and social mirage

Kédougou concentrates the majority of gold deposits. The Sabodala-Massawa mine, operated by Endeavour Mining (90 per cent) and the State (10 per cent), produced more than 229,000 ounces in 2024. Mako, more modest, adds its share to domestic production.

On paper, the figures are impressive. But the unregulated artisanal orpaillage also drains thousands of workers in precarious conditions, largely free from taxes and environmental control.

For the local population, gold has brought some jobs, but also rising prices, land tensions and land pollution with mercury.

Phosphates: the fertilizer of the world, not our fields

In Taiba and Matam, the basement is full of phosphates, essential for fertilizer production. The Chemical Industries of Senegal are transforming part of the production into phosphoric acid and fertilizer, but a large part of the raw rock is directly exported.

Ironically, while these deposits could reduce Senegal's dependence on fertilizer imports and support its agriculture, local production remains insufficient to meet domestic demand.

Mineralised sands: zircon and ilmenite, exports above all

The Great Coast Operations (Eramet 90%, State 10%) extract zircon, ilmenite and rutile, essential components for aeronautics or ceramics.

But again, all or almost all of it goes abroad in raw form. Waterfront villages see the degradation of beaches and ecosystems, with no direct tangible benefits.

Iron, oil and gas: promises of the future

The iron of Falémé (750 million tonnes estimated) is still awaiting industrial exploitation.

The Sangomar oil and gas from the GTA project are already in production or about to be produced.

Senegal hopes to earn substantial income... but the contracts concluded and the volatility of world prices cast doubt on the real manna to be expected.

Multinationals: masterpieces, game masters

In almost every large extractive project, a pattern is repeated: a consortium dominated by a foreign multinational, a free minority stake in the state (10 % in mines, variable shares via PETROSEN in hydrocarbons), and operational control exercised by the private investor.

This model attracts capital and know-how, but it creates a structural dependency: strategic decisions, volumes extracted, calendar, choice of partners, often take place outside Senegal.

This configuration limits the state's ability to direct the sector towards long-term development objectives.

A legal framework that protects... but not enough

The 2016 Mining Code and the 2019 Petroleum Code regulate royalties, state participation and local content obligations. On paper, these laws guarantee a share of income and encourage the creation of local jobs.

But their application reveals two weaknesses:

• Locked fiscal stability which prevents the state from renegotiating in the event of a surge in world prices.
• Processing and local content obligations It is still too flexible to allow companies to export almost all raw materials.

Control and transparency: one step forward, two steps backwards

Senegal is a member of the Extractive Industries Transparency Initiative (EITI), and publishes its contracts and extractive income. This is a significant improvement over other countries.

However, the physical control of the extracted volumes is largely based on the operators' declarations, due to the lack of independent measuring equipment and sufficient personnel. Outcome: suspicion of underreporting remains, particularly for high-value minerals such as gold.

Income: a real impact... but limited for the citizen

In 2023, the extractive sector accounted for 6 per cent of budgetary revenues and 38 per cent of exports.

With oil and gas, these numbers are expected to rise. But even a significant increase will not be enough to radically change living conditions if these incomes are not invested in sectors that create sustainable jobs (agriculture, industry, education).

For the moment, the mining and oil manna remains a promise, not a reality visible in the daily life of the majority of Senegalese.

Great weakness: lack of local transformation

It is probably the most fragile link in the system. The majority of products extracted leave the country without processing, which deprives Senegal:

• of the Additional income (the value of processed ore is often 5 to 10 times higher than that of raw ore),
• of the industrial skills which develop where transformation takes place,
• and thousands of potential jobs.

The causes are multiple: lack of reliable energy infrastructure, low availability of capital, lack of coercive or incentive industrial policy, and contracts that do not require local transformation.

Environmental and social impacts: the back of the medal

The economic benefits promised are accompanied by often invisible costs:

• Pollution soil and water by the chemicals used in gold-plating and industrial extraction.
• Degradation of coastal ecosystems from the extraction of mineralized sands.
• Conflicts of practice between offshore oil companies and artisanal fishermen.
• Loss of agricultural land in mining areas, forcing some communities to migrate.

These effects, which are rarely included in official economic assessments, have a direct impact on health, nutrition and social stability.

Why renegotiating contracts is so difficult

Once signed, mining and oil contracts often become Almost untouchable. This is due to several factors:

1. Stability clauses - integrated in most agreements, they freeze the tax and regulatory conditions for the entire duration of the contract (often 20 to 30 years), preventing any change even if world prices blaze.
2. International jurisdiction In the event of a dispute, arbitrations often take place in courts outside Senegal (such as the CIRDI in Washington or International Court of Arbitration(s). These bodies favour a strict reading of the contract, rarely in favour of States seeking to renegotiate it.
3. Contractual complexity The agreements are often drafted by specialized international firms, with a dense technical language and cross clauses that make their decorticating difficult for local administrationsexcept to mobilize costly legal expertise.
4. Signature guarantees : to attract investors, the State sometimes explicitly promises not to question certain provisions, which then limits any room for manoeuvre.

This contractual lock explains why, even when public opinion is indignant about a division deemed unfair, margins for renegotiating remain small, except for the risk of heavy financial penalties.

Direct impact on your life

How the exploitation of natural resources affects each Senegalese:

• Food prices : Extractive income can finance agricultural and energy subsidies, but if poorly managed, it will have no effect on the household basket.
• Employment : Oil mines and projects create jobs, but often temporary and skilled, therefore not accessible to young people without adequate technical training.
• Environment Water and soil pollution, destruction of fishing areas: effects that can reduce food production and increase health costs.
• Infrastructure If income is well invested, they can finance roads, schools and hospitals. But without citizen control, these promises may remain a dead letter.
• Economic sovereignty : Gross export dependence exposes the country to world price shocks, directly influencing the stability of public finances.

Future scenarios: curse or blessing?

Senegal is at a turning point. The choices made today will determine whether natural wealth becomes:

• A lever for development by strengthening control, more balanced contracts, local transformation and investment of income in economic diversification.
• Or a curse If income is poorly managed, contracts are frozen and resource dependence prevents investment in other sectors.

Transforming promise into reality

The Senegalese basement is rich, but real wealth will be measured in built schools, equipped hospitals, installed factories, and the quality of life of citizens.

This involves three priorities:

1. Real transparency and oversightwith enhanced technical and human resources.
2. Mandatory local transformation to maximize added value.
3. Strategic Income Investment in the sectors which will prepare the after-mines and post-petroleum.

For in essence, the question is not just to know what we have under our feetbut what we will do for future generations.