Suriname boasts of better oil contract terms than Guyana

Last Updated on Thursday, 3 October 2024, 16:40 by Writer

The Chief Executive Officer of Suriname’s state-0wned oil company, Staatsolie, has been boasting that his country has clinched a far superior production sharing agreement with TotalEnergies compared to Guyana’s with ExxonMobil and its co-venturers.

He said while Guyana has 2 percent royalty and 50 percent profit split and no taxes, Suriname’s agreement provides for 6.25 percent royalty, profit split based on “the higher the oil price the better” for Suriname, but the lower the oil price the contractor “gets protected.” Additionally, he said Suriname has a stable tax rate of 36 percent.

“You can do math and the deal is good but, of course, everybody has to survive in this partnership,” he said.

Guyana’s Opposition Leader, Aubrey Norton last month said if his People’s National Congress Reform (PNCR) wins the 2025 general and regional elections, his administration would ask ExxonMobil to renegotiate aspects of the contract so that Guyana could earn more revenues.

Meanwhile, the Suriname Guyana Chamber of Commerce (SGCC) welcomed the Final Investment Decision (FID) announced by TotalEnergies, APA Corporation, and Staatsolie for the development of the GranMorgu project in Block 58.

“This landmark $10 billion investment marks a pivotal moment in Suriname’s economic and energy landscape, bringing immense opportunities for growth and development in both Suriname and the broader region,” the Chamber said in a statement.

The SGCC said the FID is set to provide new economic opportunities through job creation, local capacity building, and enhanced energy collaboration across borders. It is expected to generate significant benefits for the local economy, with an increase in job opportunities and investments that will strengthen the private sectors of both Suriname and Guyana. Surinamese and Guyanese businesses will benefit
from partnerships in logistics, well services, and the operations of the FPSO and subsea production systems, that business support organisation said.

For Guyana, this development complements this country’s own burgeoning oil sector, fostering opportunities for cross-border investment, shared infrastructure development, and expertise. The SGCC added that collaboration between Guyana and Suriname in energy and trade is set to unlock significant benefits for both nations, enhancing regional connectivity and positioning both countries as leaders in the global
energy market.

Ambassador Liselle Blankendal of Suriname to Guyana, at a media event for the International Business Conference (IBC), celebrated the announcement of the FID as a historic moment for Suriname. “With an investment of more than ten billion US dollars, the
largest ever that Suriname has had, the country is getting a historic new beginning. This is great news and will contribute significantly to Suriname’s economic growth and boost local employment and investments,” she was quoted as saying in the SGCC statement.

The Ambassador emphasized that this investment will deepen economic ties and create lasting opportunities between the two nations. As both countries work together, they will seize the vast opportunities this collaboration brings, contributing to job creation and fostering a
robust entrepreneurial environment.