Macro

Suriname's 2.4B Barrel Oil Boom, FPSO Project Advances

Suriname's oil discoveries reach 2.4 billion barrels, signaling a global energy market shift, amid Nigeria's refinery moves and Brazilian market concerns.

By Max Weldon

5/16, 19:39 EDT
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Key Takeaway

  • Suriname's oil discoveries now exceed 2.4 billion barrels, with over 12.5 trillion cubic feet of gas, signaling major energy potential.
  • Petroliam Nasional Bhd.'s finds in Roystonea and Fusaea could support a 100,000 barrels/day FPSO, marking Suriname's first development.
  • TotalEnergies and APA Corp. are advancing towards sanctioning a significant FPSO project on Block 58, highlighting growing investment interest.

Suriname's Oil and Gas Boom

Suriname has emerged as a significant player in the global energy market with its discovered oil resources now totaling more than 2.4 billion barrels of crude and liquids, alongside more than 12.5 trillion cubic feet of gas, as reported by Wood Mackenzie. The recent discoveries by Petroliam Nasional Bhd. (Petronas) in the Roystonea and Fusaea blocks, approaching 400 million barrels, underscore the country's burgeoning potential. These finds are expected to supply a floating production, storage, and offloading (FPSO) vessel with about 100,000 barrels a day of oil-processing capacity, marking Suriname's first sanctioned development. Julie Wilson, WoodMac's exploration research director, highlighted Suriname's alignment with Petronas' LNG expertise while diversifying its portfolio.

Nigeria's Refinery Revolution

In a bold move to address its crude production challenges, Nigeria's Dangote mega refinery, near Lagos, is seeking to purchase millions of barrels of US crude over the next year. The refinery, built by Africa's richest man Aliko Dangote, aims to buy 2 million barrels a month of West Texas Intermediate Midland crude starting in July. This initiative reflects Nigeria's struggle to boost its own oil output, which has remained well below capacity due to theft, aging infrastructure, and low investment. The Dangote refinery, currently operating at half capacity, is leveraging cheaper US oil imports to meet a significant portion of its feedstock needs, showcasing a strategic pivot in Nigeria's approach to refining and energy security.

Brazilian Market Turbulence

The Brazilian financial markets are bracing for volatility following President Luiz Inacio Lula da Silva's decision to replace the CEO of state oil giant Petrobras. This move has reignited concerns about political influence on public companies, with Petrobras shares dropping 8.8% in pre-market trading. The broader implications for the Brazilian real and local swap rates are significant, as traders interpret this leadership change as a shift towards a less market-friendly government stance. The appointment of Magda Chambriard, a figure from former President Dilma Rousseff's administration, as the new CEO, has particularly alarmed investors, signaling potential shifts in Petrobras' strategic direction and governance.

Street Views

  • Julie Wilson, WoodMac (Bullish on Suriname's oil and gas sector):

    "Suriname plays to Petronas’ existing competencies in LNG development while providing oil to offset its LNG-weighted portfolio."