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Yahoo
14 hours ago
- Business
- Yahoo
Despite Delays Suriname's Oil Boom is Fast Becoming a Reality
It is a long time coming, but the impoverished South American country of Suriname is poised to enjoy the fruits of a major oil boom. For nearly a decade, the government, in the capital Paramaribo, hungrily eyed neighboring Guyana's drilling success, which transformed that country into the world's newest petrostate. Yet Suriname's offshore drilling, despite yielding positive results, repeatedly experienced uncertainty and delays. This took place as the economic situation in the former Dutch colony deteriorated, causing to President Chandrikapersad Santokhi, a former police commissioner, to lose office. Newly appointed president opposition leader Jennifer Geerlings-Simons faces uncertainty over the economy and the anticipated oil boom. Paramaribo, since the 2020 pandemic, has been battling yet another deep financial crisis, which spilled over into violence at the start of 2023 as the cost of living spiraled out of control. Protestors stormed Suriname's National Assembly in February 2023 as then-President Chan Snatokhi's International Monetary Fund (IMF) mandated economic austerity hit hard in a country where nearly a fifth of the population lives below the poverty line. Despite the hardships triggered by the austerity program, which included slashing government spending, removing energy subsidies, and sharply devaluing the Suriname dollar, there are signs of success. The IMF Executive Board, after reviewing the arrangement in March 2025 stated: 'The objectives of the program have been broadly achieved. The economy is growing, inflation is receding, public debt is declining, the autonomy and governance of the central bank have been strengthened, and investor confidence is returning.' Related: Energy Transition Stalls as Oil Super-Cycle Risks Return There is, however, still a long way to go. The IMF outlined the need for Paramaribo to enforce fiscal discipline, strengthen tax administration, improve regulatory transparency, and bolster governance mechanisms. Despite notable progress, these enhancements were insufficient for President Santokhi. During July 2025, he lost office due to the fallout from those stringent economic austerity measures and ongoing corruption allegations. It was President Santokhi who saw Suriname's burgeoning offshore oil boom as a silver bullet for a crisis-prone economy, which over the last decade contracted sharply. For 2015, Suriname reported gross domestic product (GDP) of $5.13 billion, yet by 2024 it had plunged 13% to $4.46 billion. This marked decline is hurting the population of one of South America's poorest countries, where one in six people live in poverty During January 2020, APA, the then operator of Block 58, announced the first discovery in Block 58 at the Maka Central-1 well. This was followed by four more discoveries, with the most recent being the Krabdagu discovery made during 2022. Source: APA Corporation EnerCom Oil & Gas Conference. Since the last discovery, a series of appraisal wells were drilled at the Sapakara and Krabdagu discoveries, which confirmed the presence of a reservoir containing an estimated 750 million barrels of crude oil. The oil discovered in Suriname was determined to be light and sweet with API gravities of between 35 degrees and 60 degrees with a low sulfur content. Those are important attributes in a world with a focus on producing high-quality low low-emission fuels, which are cheaper and easier to manufacture from lighter sweet crude oil. First oil from one of the five significant oil discoveries made in offshore Block 58 was initially expected in 2026, although this did not occur, with TotalEnergies postponing development of the oil acreage. Poor exploration results, including several dry wells, inconsistent seismic data, and concerns about the reservoir related to a high gas-to-oil ratio, impacted the multi-billion-dollar final investment decision (FID). For those reasons, TotalEnergies at the end of 2022 postponed the FID to further appraise and better define the oilfield's attributes. Finally, in October 2024, TotalEnergies and APA announced the $10.5 billion FID for developing the Sapakara and Krabdagu discoveries, targeting first oil in 2028. The latest news from TotalEnergies shows development of Block 58 is well underway. The project, dubbed GranMorgu, is located 93 miles offshore east of Paramaribo, targeting a reservoir containing recoverable oil resources of over 750 million barrels. Source: APA Corporation Third Quarter 2024 Financial and Operational Supplement. GranMorgu will be comprised of one drillship and a semi-submersible rig with 16 production wells and 16 injector wells. The facility is designed with nameplate capacity of 220,000 barrels per day and storage for up to 2.1 million barrels. GranMorgu will yield 220,000 barrels of crude oil and 450 million cubic feet of natural gas each day. Commissioning and first oil are projected for 2028, which represents a two-year delay from Paramaribo's original timeline. The carbon intensity of oil extraction from GranMorgu is forecast to be low. This is an important attribute in a low carbon world where governments are substantially reducing greenhouse emissions and energy companies pledge to be net carbon neutral. This includes TotalEnergies, which plans to be net carbon zero across its worldwide operations by 2050. The supermajor recently confirmed the GranMorgu project fits that goal with an all-electric Floating Production Storage and Offloading (FPSO) vessel being installed at GranMorgu. TotalEnergies is committed to no routine flaring and for all gas produced to be injected into the FPSO's tanks. For these reasons, GranMorgu is forecast to emit less than 16 kilograms of carbon per barrel of oil equivalent extracted. This is lower than the global average of 18 kilograms of carbon produced per barrel of oil equivalent lifted, but higher than neighboring Guyana, where an average of only nine kilograms of carbon is discharged per barrel. This will ensure Suriname retains its status as a global carbon sink. The 38 million acres of forest covering the former Dutch colony absorbs 8.8 million tons of carbon annually, while the country only produces seven million tons. TotalEnergies pledged to assist Paramaribo with maintaining Suriname's status as a carbon-negative country. Once GranMorgu is operational, it will generate considerable income for a fiscally challenged Paramaribo, which is struggling to find sufficient income to balance the budget while meeting sovereign debt repayments. The potential government revenue is boosted by the national oil company and industry regulator Staatsolie securing a 20% interest in GranMorgu. This stake, which is worth $2.4 billion, forms an important plank in Staatsolie's goal of tripling revenue to almost $1.8 billion before the end of this decade. While estimates vary, GranMorgu is expected to earn $16 billion to $26 billion of revenue for Paramaribo over the life of the oilfield, dwarfing Suriname's 2024 GDP of $4.46 billion. By Matthew Smith for More Top Reads From this article on Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Al Jazeera
07-07-2025
- Business
- Al Jazeera
Suriname elects first female president amid economic uncertainty
Suriname has elected Jennifer Geerlings-Simons as its first female president, with parliament backing the 71-year-old physician and lawmaker to lead the crisis-hit South American nation. Her election came after a coalition deal was struck in the National Assembly, which voted by a two-thirds majority on Sunday. The move followed inconclusive May polls and mounting pressure to replace outgoing President Chandrikapersad Santokhi, whose tenure was marred by corruption scandals and harsh austerity. Geerlings-Simons, leader of the National Democratic Party, ran unopposed and will take office on July 16. 'I am aware that the heavy task I have taken on is further aggravated by the fact that I am the first woman to serve the country in this position,' she said after her confirmation. She will be joined by running mate Gregory Rusland, as the pair inherit a country struggling under the weight of economic hardship, reduced subsidies, and widespread frustration. While Santokhi's government managed to restructure debt and restore macroeconomic stability with IMF backing, it also triggered mass protests over deep cuts. With Suriname expected to begin producing offshore oil in 2028, Geerlings-Simons has promised to focus on stabilising state finances. She has previously pledged to boost revenues by tightening tax collection, including from small-scale gold miners. Economists warn she faces a rocky road ahead. Winston Ramautarsingh, former head of the national economists' association, said Suriname must repay about $400m annually in debt servicing. 'Suriname does not have that money,' he said. 'The previous government rescheduled the debts, but that was only a postponement.' Geerlings-Simons will now be tasked with steering the Dutch-speaking country of 646,000 people through a fragile period, balancing public discontent with the promise of future oil wealth. As Suriname prepares to mark 50 years since gaining independence from the Netherlands this November, the small South American country is pinning its hopes on a new era driven by oil wealth and deepening ties with China. In 2019, it joined China's Belt and Road Initiative, becoming one of the first Latin American states to sign on to the vast infrastructure project. Suriname is one of the continent's poorest nations, despite its rich ethnic tapestry that includes descendants of Africans, Indigenous groups, Indians, Indonesians, Chinese, and Dutch settlers.
Associated Press
06-07-2025
- Business
- Associated Press
Suriname's parliament elects the country's first female president amid economic turmoil
PARAMARIBO, Suriname (AP) — Suriname 's parliament Sunday elected physician Jennifer Geerlings-Simons as the troubled country's first female president. The South American country's National Assembly chooses the president by a two-thirds vote. Geerlings-Simons, a congresswoman, ran unopposed after her party formed a coalition aimed at ousting the country's current leader following a May election with no clear winner. The coalition was formed as the troubled country prepares for an influx of wealth following the discovery of major offshore oil deposits, with the first production expected by 2028. Geerlings-Simons, who leads the National Democratic Party, will be inaugurated as president of the Dutch-speaking country of more than 646,000 people on July 16. 'I am aware that the heavy task I have taken on is further aggravated by the fact that I am the first woman to serve the country in this position,' she said after the election. The five-year term of President Chandrikapersad Santokhi has been riddled with corruption scandals, and he was forced to call on the International Monetary Fund to get Suriname's economy back on track. As a result, the country's public debt was largely restructured and government subsidies significantly reduced. Macroeconomically, Santokhi achieved success, but people groaned under the austerity measures, which sparked violent protests. Geerlings-Simons, 71, and her running mate, Gregory Rusland, on Sunday told reporters they will prioritize stabilizing the country's finances. She had previously indicated an interest in increasing state revenues by, among other things, improving tax collections, including in the small-scale gold-mining sector. Winston Ramautarsingh, former chairman of Suriname's Association of Economists, said Geerlings-Simons will face serious challenges in the years before the country produces its first barrels of oil, in part because it must repay about $400 million annually in loans and interest. 'Suriname does not have that money,' he said. 'The previous government rescheduled the debts, but that was only a postponement.'
The Guardian
04-07-2025
- Politics
- The Guardian
Suriname expected to elect first female president amid discovery of oil reserves
Suriname is expected to elect its first female president this Sunday, the congresswoman and physician Jennifer Geerlings-Simons, 71, who will run unopposed after the ruling party decided not to field a candidate. Geerlings-Simons will succeed current president Chandrikapersad Santokhi, 66, who has been in office since 2020 and was eligible for re-election – but whose party failed to secure the two-thirds parliamentary majority required in the country's indirect voting system. She will take office at a moment of profound contradiction for the former Dutch colony. Independent since 1975, it is still one of the poorest countries in the region, yet Suriname has recently discovered significant offshore oil reserves that could generate billions of dollars in revenue over the coming decades. The country is not expected to begin production until 2028. Geerlings-Simons began her rise to power on 25 May, when voters elected the 51 members of Suriname's National Assembly, though the results produced no clear winner. Her National Democratic party secured a narrow lead with 18 seats, just ahead of Santokhi's party, which won 17. In the days that followed, she managed to form a coalition with five other parties, giving her the minimum 34 seats required to be appointed president. Last Thursday, which was the deadline for registering presidential candidates, Santokhi's Progressive Reform party announced it would not be putting forward a nominee. Geerlings-Simons's party was founded by Dési Bouterse, who ruled as a dictator from 1980 to 1987, a period during which his regime was accused of executing 15 political opponents in 1982. Following Suriname's return to democracy, Bouterse was elected president in 2010 and re-elected in 2015, before handing over to Santokhi. The current president told local media there would be a 'smooth transition' of power. Corruption scandals marked his five-year term, and he was forced to seek assistance from the International Monetary Fund to stabilise the economy. While his austerity measures helped restructure Suriname's public debt, they also triggered violent protests in the country of 600,000 people. During his presidency, oil reserves were discovered 90 miles (150km) off Suriname's coast. The project to extract them is led by the French multinational TotalEnergies, which announced in October that it would invest $10.5bn to develop the oilfield. Santokhi went so far as to propose a 'royalties for everyone' scheme, under which every Surinamese citizen would receive US$750 in a savings account, with an annual interest rate of 7%. The plan was one of his key re-election pledges – but it wasn't enough to secure his party a majority. With more than 90% of its territory covered by tropical rainforest, Suriname has come under increasing pressure over illegal gold mining and logging, practices that Geerlings-Simons publicly condemned during her time as chair of the National Assembly, where she played a role in advancing environmental regulations.
The Guardian
04-07-2025
- Politics
- The Guardian
Suriname expected to elect first female president amid discovery of oil reserves
Suriname is expected to elect its first female president this Sunday, the congresswoman and physician Jennifer Geerlings-Simons, 71, who will run unopposed after the ruling party decided not to field a candidate. Geerlings-Simons will succeed current president Chandrikapersad Santokhi, 66, who has been in office since 2020 and was eligible for re-election – but whose party failed to secure the two-thirds parliamentary majority required in the country's indirect voting system. She will take office at a moment of profound contradiction for the former Dutch colony. Independent since 1975, it is still one of the poorest countries in the region, yet Suriname has recently discovered significant offshore oil reserves that could generate billions of dollars in revenue over the coming decades. The country is not expected to begin production until 2028. Geerlings-Simons began her rise to power on 25 May, when voters elected the 51 members of Suriname's National Assembly, though the results produced no clear winner. Her National Democratic party secured a narrow lead with 18 seats, just ahead of Santokhi's party, which won 17. In the days that followed, she managed to form a coalition with five other parties, giving her the minimum 34 seats required to be appointed president. Last Thursday, which was the deadline for registering presidential candidates, Santokhi's Progressive Reform party announced it would not be putting forward a nominee. Geerlings-Simons's party was founded by Dési Bouterse, who ruled as a dictator from 1980 to 1987, a period during which his regime was accused of executing 15 political opponents in 1982. Following Suriname's return to democracy, Bouterse was elected president in 2010 and re-elected in 2015, before handing over to Santokhi. The current president told local media there would be a 'smooth transition' of power. Corruption scandals marked his five-year term, and he was forced to seek assistance from the International Monetary Fund to stabilise the economy. While his austerity measures helped restructure Suriname's public debt, they also triggered violent protests in the country of 600,000 people. During his presidency, oil reserves were discovered 90 miles (150km) off Suriname's coast. The project to extract them is led by the French multinational TotalEnergies, which announced in October that it would invest $10.5bn to develop the oilfield. Santokhi went so far as to propose a 'royalties for everyone' scheme, under which every Surinamese citizen would receive US$750 in a savings account, with an annual interest rate of 7%. The plan was one of his key re-election pledges – but it wasn't enough to secure his party a majority. With more than 90% of its territory covered by tropical rainforest, Suriname has come under increasing pressure over illegal gold mining and logging, practices that Geerlings-Simons publicly condemned during her time as chair of the National Assembly, where she played a role in advancing environmental regulations.
