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Guyana and Suriname: the new offshore oil frontiers
Oil giants ExxonMobil, Shell, TotalEnergies and others are fast-tracking billions of dollars of upstream investments to develop deepwater offshore blocks in South American countries
Guyana and Suriname have emerged as the ultra-deepwater frontiers for offshore oil and gas, backed by significant investment in recent years from the world’s biggest oil companies. Since oil was first discovered in Guyana some 10 years ago, more than 13Bn barrels of oil equivalent (boe) of recoverable volumes have been uncovered in the country. Exploiting those vast fossil fuel resources, particularly in the ultra-deepwater Stabroek Block, has led to an economic boom in the country, with GDP per capita growing from US$6,477 in 2019 to US$18,199 in 2022, according to the World Bank. Oil accounted for 88% of exports in 2022.
But Guyana’s newfound prosperity has not pleased everyone. The country’s vast natural resources have attracted the attention of neighbouring Venezuela and its president Nicolás Maduro, who lay claim to the Essequibo region, and the Stabroek Block, which lies within the region. The territorial dispute between the two countries remains unresolved.
Climate critics, meanwhile, say oil and gas development threatens the country’s vast protected rain forests and natural beauty, and its low-lying coastline is vulnerable to rising sea levels and flooding.
Balancing the “world’s fastest growing economy” and environmental sustainability is Guyana’s president, Dr Irfaan Ali. He believes billions of dollars of revenues from oil and gas production can provide a better way of life for his country’s citizens, while still meeting the country’s ambitions to be net zero. He emphasises the country’s low-carbon development strategy is “a holistic approach to finding that balance, in terms of managing the environment, ensuring the livelihood of the people, promoting economic wealth.”
His beliefs will be put to the test when Guyanese voters go to the ballot box for the general election on 1 September 2025.
Stabroek development
Stabroek Block partners ExxonMobil, Hess and CNOOC have committed to spending about US$55Bn to develop six sanctioned projects — Liza Phase 1, Liza Phase 2, Payara, Yellowtail, Whiptail and Uaru. All six will use floating production, storage and offloading (FPSO) vessels, with production reaching 1.3M barrels of oil per day (bopd) by the end of 2027, and 1.7M bopd by 2030. Additionally, two other projects in Stabroek, Hammerhead and Longtail, are progressing through the regulatory review and approval process.
The success in Guyana has been nothing short of phenomenal. Since Liza Phase 1 was discovered in 2015, 30 significant discoveries have been made in the country.
“In 2024, we achieved major milestones, including producing 500 million cumulative barrels of oil and surpassing 645,000 barrels of oil produced per day from the Stabroek block,” said ExxonMobil Guyana president, Alistair Routledge.
“Guyana’s newfound prosperity has not pleased everyone”
Speaking at OTC 2025 in Houston, Mr Routledge made it clear that it was vital to safeguard Guyana’s virgin rainforests, while developing oil and gas. “We are aligning with the SDGs and we are operating in a disciplined and responsible manner,” he said, noting the award of a SUSTAIN-2 notation from ABS for the FPSO Liza Unity.
Developed by ABS, the notation signifies the vessel meets the environmental and human element requirements contained in the strategic Sustainable Development Goals (SDGs) from the UN. Four years ago, it was the first FPSO to receive SUSTAIN-1 notation, recognising the vessel’s sustainability-related aspects like pollution control and waste management. SUSTAIN-2 is the next level in vessel sustainability, noting additional attributes such as the usage of low-carbon fuels and human-centred design.
Suriname soaring
Meanwhile, spending in Suriname is soaring, with TotalEnergies, Shell, Chevron and Petronas all making plays. Total recoverable resources in Suriname are 2.2Bn boe, which Rystad Energy said ranks second among emerging exploration areas only to Namibia. Forecasts by the energy analysts suggest at least 10 wells will be drilled offshore Suriname this year and next, driving significant investment and production.
According to Rystad Energy, upstream spending in Suriname has increased from US$348M in 2020 to US$514M last year, and capital investments will reach $9.5Bn between this year and 2027, driven largely by ongoing development of the TotalEnergies-operated GranMorgu project and planned exploration campaigns.
The French oil major is upping its interest in Suriname through the acquisition of Moeve’s 25% stake in Block 53, joining APA (45%, operator) and Petronas (30%) as a partner in this license.
Block 53 lies directly east of Block 58, where TotalEnergies and its partners announced FID for the GranMorgu project. Using an FPSO, the partners will develop the Sapakara and Krabdagu oil discoveries, which are located 150 km off the coast of Suriname and hold recoverable reserves estimated at over 750M barrels.
Total investment for GranMorgu is estimated at around US$10.5Bn, with first oil expected in 2028. SBM Offshore is building GranMorgu FPSO, which will be designed to accommodate future tie-back opportunities that would extend its production plateau.
As is the case in Guyana, efforts are being taken in Suriname to produce oil and gas while reducing GHG emissions. FPSO GranMorgu will be an all-electric configuration, with zero routine flaring and full reinjection of associated gas into the reservoirs, use of a waste heat recovery unit and optimised water cooling for improved efficiency. Additionally, a permanent methane detection and monitoring system will be installed.
Block 53 contains the Baja-1 discovery, drilled near the border of Block 58.
“This acquisition brings new resources to the development of our low-cost and low-emission GranMorgu project,” said TotalEnergies senior vice president, Americas, E&P, Javier Rielo.
In June, SBM Offshore signed an O&M contract with TotalEnergies for the FPSO, which will be the first large deepwater project development in Suriname. With an expected production capacity of up to 220,000 bopd and associated gas treatment capacity of up to 500M ft3 per day, the FPSO will be spread moored in water of about 400 m and will be able to store around 2M bbl of crude oil. First oil is expected in 2028.
"Between the two countries, Guyana has traditionally been the focal point of oil exploration, but Suriname is increasingly gaining attention as a prime target, particularly in Block 58,” said Rystad Energy vice president, upstream research, Palzor Shenga. Mr Shenga noted that Suriname is actively courting foreign investment, creating a favourable environment for E&P. “There is every reason for assets in Suriname to be capable of generating healthy cash flows despite operating in a high-risk and relatively unexplored environment," he said.
“We are aligning with the SDGs”
Shell and its partner QatarEnergy are assessing the potential of the Araku Deep-1 well in Block 65, and Malaysian oil giant Petronas is also active in Suriname’s upstream exploration. It is focused on developing its discoveries in Block 52, where recoverable resources are estimated by Rystad Energy to exceed 500M boe. These discoveries include Sloanea-1 (2020), Roystonea-1 (2023) and Fusaea-1 (2024). However, Petronas must either continue the project independently or seek a new partner, following ExxonMobil’s exit from its 50% stake in the block last year. A successful exploration campaign and a significant discovery could accelerate development plans and attract potential partners to the project.
Hess quits deepwater block
After failing to attract partners to develop Block 59 in offshore Suriname, Hess has returned the deepwater acerage to state-owned oil company Staatsolie. The move follows last year’s exit of previous partners ExxonMobil and Equinor, which transferred their stakes to Hess after deeming the risk was too high for drilling an exploration well in Block 59.
“Significant volumes are required for potential economically viable oilfield development in this block. After 6,000 km of 2D seismic data and 9,000 km2 of 3D seismic data were collected in the block, the two previously exiting partners considered the risk too high for drilling an exploration well,” said Staatsolie.
ExxonMobil and Equinor exited the block in July 2024. In the past year, despite efforts, Hess did not find any new partners to continue exploration of Block 59.
The area formerly designated as Block 59 will be incorporated into Staatsolie’s strategy to have as much of the offshore acreage under contract with international parties. Currently, production sharing contracts are in place with several IOCs for the various blocks, covering approximately 50% of Suriname’s offshore.
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