Exxon signs Suriname deal to explore 2.8 million acres offshore

Jul 14, 2017 News, http://www.kaieteurnewsonline....lion-acres-offshore/

State Oil Company of Suriname yesterday concluded production contracts for two offshore blocks.

For Block 59, an agreement has been signed with a consortium consisting of the oil companies ExxonMobil, Hess Corporation and Statoil. Statoil has signed a contract for Block 60.

The agreements are the result of Government Oil ‘Open By Policy Offshore Suriname’, which ran from September 15, 2015 to September 7, 2016.

During this period, international oil companies could bid on open offshore blocks. Based on the established criteria, the blocks 59 and 60 are assigned to the consortium and Statoil respectively. Negotiations with the parties started in mid-October 2016.

The agreements are valid for 30 years. The contract duration is divided into an exploration, development and production period. A minimum work programme has been agreed for the exploration period, including geological research, seismic data collection and exploration drilling.

All costs in the exploration phase are at the expense of the consortium and Statoil, and will only be refunded after they have made a commercial discovery and put into production. The contract offers Government Oil the opportunity to participate in up to ten percent in the development and production phases. In the production distribution contracts, attention has been paid to inspection, safety and the environment.

There are also provisions for employment for local frameworks, trainings, social programmes and the manner in which dismantling of facilities at the end of the petroleum activities will take place.

On behalf of State Oil, General Director Rudolf Elias signed both contracts. For the consortium, Erik Oswald (ExxonMobil), Timothy Chisholm (Hess) and Martijn Smit (Statoil) signed. The agreement for Block 60 was also signed by Smit on behalf of Statoil.

Block 59 is approximately 11,500 km2 and is located approximately 400 kilometers offshore, in water depths of more than 1900 meters (ultra-deep). Block 60, with a surface area of 6,200 km2, is approximately 250 kilometers offshore, in water depths from 800 to 1900 meters.

The US ExxonMobil is the largest listed oil and gas company in the world with activities in different parts of the world. ExxonMobil, together with its partners, has made recent major oil finds in Guyana.

Hess Corporation is a large, independent energy company active in different countries. Hess, together with her partners in Guyana, has done the great oil hunter Liza-1. In Suriname, Hess already has a 33.3 percent stake in Block 42. Statoil is Norway’s state oil company which has become a multinational asset in exploration, production, refining and shipping of oil and gas. Since January 2014, Statoil already has a 50 percent stake in Block 54.