QatarEnergies buys into Suriname oil expansion

Alamy/Ron Giling

• Deal signed for 20% of block
• Commitment for exploration well
• Oil production boom expected

The state-owned giant QatarEnergy has signed a deal with US oil company Chevron to acquire a 20 percent interest in a production-sharing contract for an offshore concession in the South American country of Suriname.

Chevron will keep a 40 percent interest in Surname’s block 5, as will Paradise Oil, an affiliate of Suriname’s national oil company, Staatsolie.

The concession is located in shallow water depths of 30 to 45 metres.

The licence is currently proceeding to its second exploration phase, with a commitment to drill an exploration well. 

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Suriname, one of the smallest and poorest countries in South America, is also one of the top bauxite producers in the world.

The boom from recent Guyana oil production is expected in Suriname too, since the two neighbouring countries share one hydrocarbon basin.

A former Dutch colony, Suriname has had a series of nine major offshore oil and gas discoveries over the past six years.

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Combined, they opened access to 2.4 billion barrels of oil and more than 12.5 trillion cubic feet of gas in reserves, according to consultancy Wood Mackenzie.

These discoveries are not yet commercialised, with Suriname’s first major offshore production about four years away.

However, oil and gas majors have made a strategic move to tap into the resources early to yield potential high returns, Matt Stanley, an energy expert at the global trade analytics supplier Kpler, told AGBI.

Kpler estimates that by the early 2030s Suriname oil production could reach around 600,000 barrels per day.

In December Shell, TotalEnergies, QatarEnergy, and Petronas signed production-sharing contracts with Staatsolie for three offshore blocks.

Block 58, Suriname’s $9 billion oil and gas project developed by TotalEnergies and APA Corp, is expected to receive the go-ahead in the fourth quarter of 2024 and begin production in 2028.

The concession borders Exxon Mobil’s Stabroek block in Guyana, which has 11 billion barrels of recoverable oil and gas. 

“By Qatar investing in Suriname, QatarEnergies diversifies its portfolio beyond the traditional Middle East focus and brings opportunities for the future in emerging markets,” Stanley said.