The small country of Suriname, with a population under 600,000, has become the hottest prospect for oil companies due to the promise of large quantities of oil at super low development costs. Suriname has agreed to royalties of only 6.25 percent. This is less than half the average rate in the developing world, which is roughly 16 percent. It is no wonder big oil’s mouth is watering with at least 15 wells set to be drilled in the Suriname side of the Guyana-Suriname basin in the next year. 

Suriname has at least three to four billion barrels of reserves, or up to half the new oil and gas discovered around the world last year. Total and APA (formerly Apache) have made four oil discoveries since the beginning of 2020 in block 58. In December 2020, ExxonMobil and Petronas announced their first oil discovery in block 59.  

While the COP26 climate deal was being negotiated, a climate deal of a different kind was also being negotiated with the government of Suriname. The International Monetary Fund (IMF), Inter-American Development Bank (IDB) and the World Bank are in on-going negotiations with the government of Suriname regarding what policy reforms and government actions need to be adopted in order to obtain US$1.04 billion in finance for Suriname’s budget (see Table 1). 

Table 1. Upcoming IFI Budget Finance Operations in Suriname 

There are strong reasons to believe that the unprecedented IFI budget finance for Suriname and associated policy reforms, which include “improvement to the investment climate”, are largely aimed to secure billions in final investment decisions for upstream oil (please see attached briefing for details).  

The time for action is now before the budget finance is approved. The IDB's first planned operation goes to the Board on December 15. The attached briefing provides details, a timeline of the oil development and IFI involvement, and a list of questions to ask Executive Directors and the IMF, IDB and World Bank.

Urgewald