DAKAR (Reuters) -Senegal's Sangomar oil and gas field has produced its first oil, operator Woodside Energy said on Tuesday, turning the West African nation into the world's newest oil producer.

It marks the start of a new era for the country, where gas production is also due to begin by the end of the year at the Greater Tortue Ahmeyim (GTA) liquefied natural gas (LNG) project, operated by BP, straddling Senegal's border with Mauritania.

"This is an historic day for Senegal and for Woodside," said Woodside CEO Meg O'Neill in a statement. "First oil from the Sangomar field is a key milestone and reflects delivery against our strategy."

Discovered 10 years ago about 100 km (62 miles) offshore south of the capital Dakar, Sangomar is expected to produce about 100,000 barrels per day.

A floating production storage and offloading (FPSO) vessel for the project arrived in the country in February.

The project's Phase 1 development, cost between $4.9-$5.2 billion, Woodside said, adding that 21 of 23 wells have been drilled and completed, including nine production wells.

"The drilling campaign at Sangomar is ongoing and Woodside expects to continue commissioning activities and safely ramping up production through 2024," the statement said.

Sangomar crude has an API gravity of 31 degrees and contains 1% sulphur, making it similar in quality to Oman and Norway's Johan Sverdrup crudes, O'Neill said.

"We expect the crude to be mainly processed by refineries in Europe and Asia and we are seeing solid demand for our product in the market and have already sold our first few cargoes, both of which are expected to go to Europe," she told analysts on a conference call.

The company holds an 82% participating interest in the project, while Senegal's national oil company Petrosen has an 18% stake.

"First oil from the Sangomar field marks a new era not only for our country's industry and economy, but most importantly for our people," Thierno Ly, Petrosen's general manager for exploration and production, said in the statement.

Senegal's newly elected President Bassirou Diomaye Faye has said his government would conduct an audit of the nation's oil, gas and mining sectors, and re-negotiate the terms of oil, gas and mineral contracts with foreign operators in the country.

Addressing concerns about potential changes in fiscal terms, Woodside's executive vice president for international operations, Shiva McMahon, said she had had a "very good meeting" with Senegal's new energy minister, Birame Souleye Diop, about two weeks ago.

"It was a very positive meeting, and Minister Diop also reiterated and reinforced the importance of respecting of contractual obligations by all parties," McMahon said.

(Reporting by Diadie Ba; Additional reporting by Florence Tan; Writing by Anait Miridzhanian; Editing by Bate Felix, David Evans and Sonali Paul)

By Diadie Ba