Hart Energy: Guyana-Suriname basin shows long-term promise – OTC 2018

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The first rule of puzzle assembly is to start with the edges and work in, flipping pieces this way and that, until the snap of snug fit indicates correct piece placement. When looking at a world map, it is easy to see how South America and Africa were once part of a larger whole.

By working the edges of each, offshore E&P discovered vast reservoirs of oil and gas off the coasts of Angola and Brazil. Major oil discoveries in offshore Guyana in recent years have led to increased international investment in the Guyana-Suriname Basin.

Attendees at Tuesday morning’s OTC 2018 industry breakfast on Guyana and Suriname were transported to the lush forests of the region as they learned about how 16 years of patience and perseverance led to the eventual discovery at Liza-1 by ExxonMobil and its partners Hess and Nexen in 2015.

“In May 2015 the Liza well came in. It was an incredible well and it has only gotten better,” said Erik Oswald, vice president of exploration, Americas, ExxonMobil Upstream Research Co. “Right now we’re working on the fifth appraisal well. It is a huge deal and a great thing for Guyana.”

Four Liza wells later, along with discoveries at Payara, Snoek, Pacora, Turbot and Ranger in the Stabroek Block between 2015 and 2018, have resulted in an estimated potential resource reserves in excess of 3.2 Bbbl for the operator and its partners.

Hess’ Timothy Chisholm, vice president of exploration, appraisal and developments, Guyana and Suriname, shared with attendees how the company sees Guyana as a major growth opportunity within its portfolio.

Chisholm added that the development and future exploration success in the Guyana-Suriname Basin depends on successful partnerships with commercial, government and resource owners.

The potential for Suriname is significant according to Tom Ketele, nearshore drilling project manager for Staatsolie. The country, with more than 30 years of onshore production, has onshore crude reserves to sustain it for the next 15 years, he said. By developing its ultra-shallow nearshore resource potential, the country will be able to extend those reserves significantly.

Staatsolie has identified and ranked 15 prospects, some stacked, in water depths of 5 m to 30 m offshore. The company has plans to drill a 10-well exploratory campaign from April 2019 to December 2019, he said.

The Liza story demonstrates the importance of not walking away after the first dry hole according to Bob Fryklund, Chief Upstream Strategist, IHS Energy.

“There are plenty of opportunities in South America,” he said. “Guyana and Suriname represent two different spots on the ‘proof of concept’ model for frontier development.”

He noted that Guyana is an emerging producer while Suriname is just entering the offshore. Prospects abound in both locations but a big question that remains in the discussion is how far the Guyana-Suriname Basin extends across the border into Suriname.

The Liza Field, he added, contains 64% of the total recoverable resources for the area, he said. An extensive look at the field’s economics showed that it is competitive with the Permian Basin as its breakeven price of $24/bbl. (Hart Energy)