Suriname has the potential to become an oil production hot spot in the near to mid-term.
That’s according to GlobalData, which highlighted that four discoveries were made in the country’s Block 28 last year.
“Results from the four discovery wells drilled in Suriname so far have showed excellent oil properties, with API ranging from 27° to 37°,” Svetlana Doh, an upstream oil and gas analyst at GlobalData, said in a company statement.
“Type and fluid quality is close to the lighter oil produced in the Stabroek block of neighbouring Guyana, where wells could reach high productivities of 11,000 barrels of crude oil per day. Since both countries share the same geological trend of Guyana-Suriname basin, Suriname has huge potential for repeating Guyana’s oil exploration success,” Doh added in the statement.
Taking Guyana projects as a reference, GlobalData expects that Suriname will reach a break-even price of around $40 per barrel. The company also expects that the initial capital investment for an average project in Suriname could be between $6 billion and $8 billion, with recoverable reserves reaching around 600 million barrels of oil.
“The anticipated low break-even price is still slightly higher than in Guyana, where some projects go as low as $25 per barrel, however, if the development wells in Suriname confirm high productivities (at least 6,000 barrels per day) and the required infrastructure is built, break-even price is expected to be considerably lower than $40 per barrel,” Doh said.
“For an average break-even price to go down by just $5 per barrel, either initial capital expenditure needs to be reduced by at least 20 percent, or well productivity need to 17 percent higher,” the GlobalData representative continued.
Block 28 operators TotalEnergies and Apache Corp were awarded a contract for preliminary front-end engineering design in June for the manufacture of floating production and storage, GlobalData highlighted. First production at the project is scheduled to start in 2025.
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