Exxon, Petronas Set to Extend Exploration Offshore Suriname

Exxon and Malaysia’s state-run Petronas will extend exploration for a gas discovery off the coast of Suriname, the country’s national oil company, Staatsolie, said on Monday. 

Eyeing a repeat of the huge oil and gas success in the same basin offshore Guyana, explorers in Suriname are also reportedly considering a floating LNG project. 

Exploration in Suriname has not been as successful, so far, as Guyana. Exxon and Petronas made a gas discovery in 2020 in Block 52 that was considered commercially unattractive, while discoveries have been made in Block 58 by French TotalEnergies and Apache Corporation.  

The exploration extension is for Block 52’s Sloanea-1 discovery, Reuters reports, which could make a commercial gas discovery in the block feasible for development. 

Presently, Petronas and Exxon are planning to drill the Sloanea-2 appraisal well. If that well proves commercially viable, first production would commence around 2031 at the earliest. 

"A key component of feasibility is the guarantee of a tax-free period of 10 years from the start of production. This is also stipulated in the letter of agreement, with government approval," Reuters quoted Staatsolie as saying in a statement. 

Exxon and Petronas signed a production sharing contract with Suriname in 2013, covering BLock 52. Petronas also has PSCs with Staatsolie for Blocks 63 and 64.  

The deal, signed on Monday by Petronas, Exxon and Staatsolie executives, serves as the basis for further negotiations for a gas addendum to the production sharing contract they signed in 2013 for Block 52.

TotalEnergies and Apache have made five high-quality oil discoveries offshore Suriname, in Block 58, since 2020. The most recent discovery was the Krabdagu wildcat, completed in February 2022, while the most recent exploration well drilled, which came up dry, was in November that same year.

By Charles Kennedy for Oilprice.com

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