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Guyana, Suriname Oil Bonanza to Boost Economies, Help Meet Global Demand

By Vijay Jayaraj – MasterResource – July 25, 2022

The poverty-stricken Caribbean countries of Guyana and Suriname have hit the jackpot with the discovery of huge offshore oil reserves that are on track to produce revenue for decades.

Opposition from the United Nations and other anti-hydrocarbon entities might hamper the pace of production but won’t stop it. The global need for more crude is too great, and the economic situation of the two South American nations is too dire.

Suriname has been experiencing double-digit inflation for a while now (35 percent in 2020). The inflation rate is now above 50 percent due to the ongoing global energy crunch. Suriname’s economy shrank by 3.5% in 2021. Guyana’s economy is in a similar situation, with 40 percent of Guyana’s 800,000 living in poverty.

All this could change now, thanks to the oil discovery.

Equatorial Guyana and Suriname—situated side-by-side and bounded by the equator and Atlantic Ocean — have combined oil reserves estimated to be 17 billion barrels of oil equivalent. Together this represents the world’s largest oil discovery in the last two decades. Some call it the “the most promising oil discovery hotspot on earth.” Others say it is “the most exciting oil frontier on earth.” In addition, there are gas reserves of more than 30 trillion cubic feet.

According to a Hess Corporation report, the biggest Guyanese oil block—the Stabroek—“is operated by ExxonMobil subsidiary Esso Exploration and Production Guyana” with a 45 percent stake while Hess Guyana Exploration and CNOOC Petroleum Guyana hold 30 and 25 percent stakes, respectively. Guyana will deliver 1 million barrels per day (bpd) in 2027.

In Suriname, TotalEnergies and its partner Apache made discoveries of large oil reserves in what is known as the Block 58 offshore site. Block 58 is “situated on the same petroleum fairway which runs through Guyana’s Stabroek Block.”

Around 2035, the output from Guyana is expected to be around 1.4 bpd and that from Suriname 650,000 bpd, which would put them in the top five oil-producing countries in South America.

Still, analysts believe that output from Guyana could be much higher: “there is every indication, based on the latest developments, that output will be far higher by” 2027. “Government officials in Georgetown [Guyana’s capital] believe crude oil production could reach 1.5 million barrels per day, or more, from as many as 12 Floating Production Storage and Offloading facilities in five years.”

The biggest hurdle to the extraction of these reserves could come from lack of capital. Both Suriname and Guyana have an “underdeveloped capital market with limited financing options” for new projects.  These nations will be under severe financial stress if the international climate-industrial complex takes a strong stand against their extraction plans and their own governments acquiesce.

But awareness of this is increasing among leaders who are rushing to cut red tape for foreign investment. Last week, Guyana President Mohamed Irfaan Ali promised that his “government will remove bureaucratic hurdles to smooth the journey for Saudis looking to invest in his country.”

Common sense suggests that the global markets will dictate the development of oil fields in these countries. With a continuing rise in demand for oil forecast by the International Energy Agency, one would expect crude from Guyana and Suriname to sell fast.

This will prove to be a win-win for global supply and the development of local economies. “Suriname’s nascent oil boom is gaining momentum” and will deliver a “significant fiscal and economic windfall,” says Matthew Smith at Oilprice.com.

“Guyana will materialize as a leading global oil exporter with its petroleum output far exceeding domestic demand, while government coffers will swell with annual income expected to be over $10 billion annually in less than a decade,” he says.

The ability of Guyana and Suriname—and their right—to develop economically by utilizing their oil reserves should not be impeded by the climate-frenzied.

Vijay Jayaraj is a Research Associate at the CO2 Coalition, Arlington, VA, and a Contributing Writer with the Cornwall Alliance for the Stewardship of Creation. He holds a master’s degree in environmental sciences from the University of East Anglia, UK, and resides in Bengaluru, India.

July 31, 2022 Posted by | Economics, Malthusian Ideology, Phony Scarcity, Timeless or most popular | , | 2 Comments

Major oil discovery puts Suriname in spotlight amid Venezuela crisis and US-China trade war

By Uriel Araujo | October 22, 2020

Although Guyana’s newly discovered oil reserves and US interests in the region have been the focus of attention, not many analysts have been noticing neighboring Suriname, one of Latin America’s poorest countries. Guyana’s prospects have certainly changed tremendously – its economy was forecasted by the IMF to grow 85% percent this year. We should expect similar things in Suriname with the discovery of new oil fields offshore that are estimated to have 1.4 billion barrels, according to Rystad Energy. This has already attracted interest from foreign investors.

The wider Guyana-Suriname Basin is being described as the world’s number one offshore exploration. ExxonMobil has already discovered the equivalent of more than 8 billion barrels worth of oil in the region and has announced its 18th oil discovery in the Stabroek block in Guyana. Oil experts believe that what Exxon is doing in Guyana can be reproduced in Suriname.

Last month, after three discoveries, oil company Apache announced a fourth offshore well, all in Suriname’s Block 58. Recently, Shell bought a package of Kosmos Energy’s exploration assets, including a 33% stake in Suriname’s Block 42. Malaysian oil company Petronas has already spudded its first well in Suriname on October 12.

In fact, this makes Suriname a potentially future wealthy petro-state. This in itself is sure to place the country on the international radar soon, and this is happening at a time of crisis.

This region is indeed rich in national resources. In fact, there is also a new gold rush going on – gold prices have gone up 25% this year – with conflicts in the Brazilian-Suriname border region between local indigenous tribes and artisanal miners from Suriname and elsewhere. Such problems could be used in the narrative wars depending on how leaders in the Suriname capital of Paramaribo position themselves on the Venezuela issue. The issue of drug trafficking and gold smuggling is one of the main rhetorical weapons employed by the US against Venezuela.

Furthermore, Chinese aspirations in the Caribbean region and the Northeastern Atlantic coast of South America have been increasing friction between Beijing and Washington. Suriname has seen a recent wave of Chinese companies and Chinese migrants arrive. Also, Beijing and Paramaribo have held a strategic cooperative partnership since November 2019 – in areas such as communication, energy and infrastructure construction but also medicine, law enforcement and coordination on global issues. Moreover, Suriname and Venezuela reaffirmed on August 10 their commitment to further expand ties, including in energy, food, and cultural agreements.

Mike Pompeo’s September 17 visit to Suriname and Guyana made him the first US Secretary of State to do so. Pompeo did ask Suriname and Guyana to favor US businesses over China. The latter has invited both South American countries into its Belt and Road Initiative.

In the near future, we can expect a lot of competition between oil giants such as Chevron, ExxonMobil and the Chinese National Offshore Oil Corporation (CNOOC) over Surinamese oil in international bidding. And, as we have seen with the dispute over  5G and Chinese company Huawei (involving Brazil as well), there is a global US-Chinese trade war going on. So, it is not just “the attraction of oil”, as some analysts have described it. Trade disputes often are an aspect of geopolitical competition and closer economic relations may accompany cooperation in other areas and narratives of “shared values”.

Another hot issue is Venezuela. It is surrounded by nations that do not recognize the current government. It borders to the west with Colombia; to south with Brazil; and, finally with Guyana (to the East). In fact, there would be, in terms of physical continuity, a straight line towards the Atlantic Ocean in the Guyana Shield Region of small countries aligned with the US over hostilities against Caracas, further isolating and encircling Venezuela.

After Pompeo’s trip, some analysts are concerned the US could be planning another intervention against Venezuela. Pompeo’s visit to Suriname was certainly also aimed at exerting some influence on Suriname ‘s new president Chan Santokhi. Last week, Washington sent Homeland, Treasury, USAID, State Department, and high level teams from three other Departments to Suriname. It is the first time that six American government agencies were simultaneously in a mission in Suriname.

To counter Chinese influence, the US can certainly offer plenty of investment opportunities and also help Suriname with its engagement with the IMF, as well as with USAID. Should Washington and Paramaribo relations further develop, Suriname shall be expected to distance itself from Venezuelan President Nicolas Maduro. Venezuela is the one hot issue the Caricom bloc, of which Suriname is a member, currently faces. So far, Caricom has maintained a non-interference position.

The northeast coast of South America remains quite tense, with migration crises, smuggling as well as narcotics-related conflicts and border disputes involving Venezuela and Guyana. The US and Guyana conduct joint maritime patrols near the Venezuela-Guyana border and the latter supports “democratic change” for Venezuela. Should Venezuela-Guyana tensions escalate, Suriname too will be pressed to take a side.

On Monday, Suriname and Guyana issued a joint statement reaffirming their commitment for cooperation in transportation infrastructure and other areas. However, competition between the two countries for the development of their deepwater resources may also ensue and Suriname’s close ties with Venezuela are certainly a concern to Guyana.

We should be hearing a lot about Suriname in the near future on the back of these developments. The discovery of oil fields is not the only thing that is new for Suriname. The geopolitical scenario too has changed, with a so-called “new cold war” going on in South America and the Caribbean between Russia, China and Venezuela on one side, and the US, Colombia, and Brazil on the other.

For Suriname, therefore, the current scenario may present an almost existential problem. Considering US history of interference abroad and the tense situation around Venezuela, Suriname could very well find out that being in the spotlight might also be a curse. In 2017 when Russian Foreign Minister Sergei Lavrov visited Suriname, Moscow and Paramaribo were close to signing a military cooperation agreement – but the conversation stalled. Suriname would perhaps benefit greatly from restarting such a conversation. Due to its size and its limitations, Suriname cannot afford to be “neutral”: it will need to take a side in the current “new cold war”.

Uriel Araujo is a researcher with a focus on international and ethnic conflicts.

October 22, 2020 Posted by | Economics | , , | 1 Comment

South America: UNASUR To Build Fibre-Optic ‘Mega Ring’

By Chelsea Gray | The Argentina Independent | August 21, 2013

unasurThe Union of South American Nations (UNASUR) has approved plans for an optic fibre mega-ring which will break its members’ “dependence on the US, and provide a safer and cheaper means of communication.”

The fibre optic ring will become part of a ten-year plan to physically integrate all 12 UNASUR member states. The line, which will reach up to 10,000 kilometres long and will be managed by state enterprises from each country it crosses, is expected to interconnect South America through higher coverage and cheaper internet connections.

Industrial Minister of Uruguay, Roberto Kreimerman, explained that “it is about having a connection with great capacity that allows us to unite our countries together with the developed world.”

He continued to say, “We are considering that, at most, in a couple of years we will have one of these rings finalised.” He also added that ”I think the economy, security, and integration are the three important things we need in countries where Internet use is advancing exponentially.”

At the moment, up to 80% of Latin America’s communications go through the US. However, plans for an independent communication line comes shortly after the US was discovered to have been spying on Latin American data. The National Security Agency (NSA) were revealed to have been monitoring emails and intercepting telephone logs, spying on energy, military, politics, and terror activity across the continent.

UNASUR is made up of Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Guyana, Paraguay, Peru, Suriname, Uruguay, and Venezuela.

August 21, 2013 Posted by | Civil Liberties, Full Spectrum Dominance | , , , , , , , , , , , , , , , | Comments Off on South America: UNASUR To Build Fibre-Optic ‘Mega Ring’

UNASUR to Create Military Force

By Laura Benitez | The Argentina Independent | May 9, 2013

The Union of South American Nations (UNASUR) has announced that it will create a united defence body to promote democratic stability among its member countries.

Military delegates of Argentina, Brazil, and Ecuador concluded a two day meeting yesterday in Quito, and agreed on creating the first South American Defence College (ESUDE) – a safety training centre with the aim of turning “the regions into a zone of peace”.

UNASUR has said that the idea behind ​​the project is to “eliminate outdated visions that have formed our military, with manuals and taxes from foreign powers.

“The goal is to start from scratch and consider a defence doctrine, without starting from the premise of opposing countries. It is important to define our role in the military, to assume responsibility for prevention, border control or emergency responses.

“We want to create a body of higher and postgraduate education to create a regional identity for civilians and our military, and to avoid interference of other countries or geopolitical zones,” a UNASUR spokesperson said.

The ESUDE proposal paper will be presented at the next meeting of the executive body for the South American Defence Council in Lima, Peru on the 16th and 17th May. Members who attended yesterday’s meeting in Quito will meet again during the second week of July in Buenos Aires, to define the Esude proposal.

One of the issues that is expected to be up for debate in the following meetings is the level of participation in the armed forces from each country.

The initiative already has the support of other member countries, including Argentina, Brazil, Ecuador, Peru, Venezuela, Guyana, Suriname, and Uruguay.

May 9, 2013 Posted by | Solidarity and Activism | , , , , , , , , , | Comments Off on UNASUR to Create Military Force