Woodside, FAR dispute erupts in Senegal

13 June 2017, Week 23, Issue 693

The dispute over Woodside Petroleum’s entry into the oil finds offshore Senegal have flared up, with the company publicly exchanging complaints with FAR. 

FAR will not support Woodside’s plan to carry out work as a development lead – a step towards becoming operator – on the SNE field. This is “essential” to meet the planned schedule, Woodside said, on June 8.

FAR has complained that Woodside’s acquisition of stakes in the three Senegal blocks – Rufisque, Sangomar and Sangomar Deep – have not been approved by the Senegal government. Furthermore, FAR has complained that it did not have an opportunity for pre-emption.

Woodside denies both these claims, saying they are without merit. The company says it has complied with licence terms and Senegalese law.

“These actions by FAR put at risk the timely development of the SNE oil field in a prospective emerging basin,” Woodside’s CEO, Peter Coleman, said. In a thinly veiled call for governmental intervention, the official said the SNE plan had value to the Senegalese people – in addition to companies’ shareholders.

Woodside has said it is targeting the first phase of production, via a floating production, storage and offloading (FPSO) vessel, to reach first oil possibly by 2021. FAR’s actions pose risk to the development plans, it said.

FAR, responding to Woodside’s statement, said it had pushed an accelerated development plan for the joint venture and that the suggestion it was “putting at risk the timely development of the project is incorrect”.

FAR maintains that Cairn Energy is the operator of the venture and that, while Woodside may have talked of taking over this role, “there is no joint venture agreement for this to occur”. The companies working on the blocks have not been informed of a transfer of ConocoPhillips’ stake to Woodside by the government, it said. The US independent opted to sell out of the area in mid-2016, transferring its interest to Woodside in October.

The Australian minnow went on to say it was reserving its rights on the dispute, including an option for international arbitration.


The most likely option for SNE remains that FAR will agree to drop its objections and progress will continue. For this to occur, though, it may well be that the government has to become involved. That said, there is a growing chance of a legal dispute, which would slow development of the field down.