Guyana and Suriname are becoming pivotal areas for oil and gas development, with the potential to significantly influence global energy dynamics, according to Patrick Jelinek, EY Americas Oil and Gas Leader.
Jelinek notes that Guyana’s nascent energy sector offers both opportunities and challenges, with the potential to drive socio-economic progress through industrialization and infrastructure improvements. However, rapid growth requires “operational excellence and innovation” to navigate the evolving regulatory and risk landscape.
Companies interested in Guyana should “recognize the evolving nature of the local content regulations” and focus on establishing robust partnerships and compliance frameworks, Jelinek advises.
Guyana’s Local Content Act, a key legislative tool, has facilitated the employment of Guyanese nationals in the industry, with 40 specified areas in the services sector mandating local procurement by oil and gas companies and their subcontractors. To further strengthen local content policies, a series of amendments to the legislation have been planned.
In contrast, Suriname offers a more mature landscape with varied operators, providing strategic advantages, especially in gas field development. Suriname, an onshore oil producer for approximately 45 years, anticipates significant growth in offshore oil production. The first final investment decision (FID) is expected in 2024, with projections of producing over 200,000 barrels of oil per day by 2028.
For companies considering entering or expanding in Guyana and Suriname, Jelinek emphasizes the importance of understanding each country’s regulatory, tax, and labor frameworks. “Expertise in navigating these aspects is crucial to maximizing opportunities and mitigating risks,” Jelinek stated.
The oil and gas industry has been a cornerstone of the global economy, with demand consistently rising, except during the COVID-19 pandemic. New discoveries and vast oilfield reserves continue to support global production, crucial for meeting this demand. In May 2024, a GlobalData poll highlighted the oil field developments with the most promising short to medium-term prospects. The emerging oil fields of Guyana and Suriname stood out, with 33% of respondents identifying them as the primary growth engine for oil development.
