Total and Apache are expected to make their Final Investment Decision (FID) to develop oil fields at Block 58 offshore Suriname later this year in what experts say could be the second fastest ramp up in oil production activities in the Guyana-Suriname basin this decade.
The explorers announced their first discovery at Maka Central-1 back in January 2020 and have gone on to make other discoveries on the block since then at Sapakara West-1, Kwaskwasi-1, and Keskesi East-1.
Apache said last week it has ceased drilling operations at the Keskesi East-1 well, which struck oil in the Upper Cretaceous-aged depths in January, due to substantial pressure encountered at the prospect. The drill campaign was seeking additional crude oil deposits in the deeper Neocomian-aged targets.
“As drilling progressed, the well encountered substantial pressure increases that APA and Total determined could ultimately exceed the capabilities of the wellbore design and pressure control equipment,” Apache said in a statement. “Consequently, the partners decided to conclude drilling operations at Keskesi before reaching the Neocomian targets.”
RBC Capital Markets analyst Scott Hanold is quoted in an S&P Global Platts report as saying while the announcement is not good news for Suriname exploration it should not be considered discouraging either.
The most likely scenario is Total and Apache announce a final investment decision late this year to target production in shallower depths off of Suriname, he said.
“I think there’s still potential there. I don’t think you need this to make the (Neocomian) play. I think it’s additive,” Hanold said. “It just takes a little icing off the cake on the upside.”
Total recently confirmed that plans are underway to begin developing oil fields at Block 58 as early as 2025, around five years after the Maka Central-1 discovery. If successful, this would mark the second fastest development ramp up in the Guyana-Suriname basin since U.S. oil major ExxonMobil hit first oil at the Liza field in Guyana in December 2019, just under five years from its first discovery in 2015.
Analysts at consultancy group Wood Mackenzie have said the Maka Central-1 and Sapakara West-1 discoveries are likely to be developed utilizing a high-capacity floating oil production complex.
“We expect the production of these volumes with a 150,000 b/d FPSO. Due to the lack of clarity on gas commercialisation options, we assume the development of the gas and condensate interval is not viable,” WoodMac said.
Block 58 comprises 1.4 million acres and offers significant potential beyond the discoveries made to date. Apache and Total have identified at least seven distinct play types and more than 50 prospects within the thermally mature play fairway.
US multinational investment bank and financial services company Morgan Stanley says its modelling of Block 58 shows that it contains a potential 6.5 billion barrels of oil equivalent resources.
