Suriname’s state-owned oil company Staatsolie has signed production sharing contracts for two shallow water offshore blocks with French oil giant TotalEnergies and Middle East player QatarEnergy.

Staatsolie confirmed the development on Monday and said the PSCs granted exploration, development, and production rights for Blocks 6 and 8.

The exploration period for the two tracts will last six years, with TotalEnergies and QatarEnergy bearing all costs during the block’s exploration phase.

The first exploration well in the two acreages is likely to be “drilled in the third or fourth year”, according to Staatsolie.

2021 bid round

The two blocks, covering more than 2750 square kilometres, were awarded in 2021, as a part of Suriname’s shallow water bid round and negotiations held since then have led to finalisation of the contracts.

TotalEnergies will hold a 40% stake in both blocks, while QatarEnergy will holds a 20% stake in each.

Unlike the deep-water acreage, where Staatsolie holds opt-in rights after declarations of commerciality, the state-run player has taken up a 40% stake in both shallow water blocks in the exploration stage.

“By participating in the PSC with 40% from the start, Staatsolie will actively participate in the collection and analysis of data,” the Surinamese player stated.

Both areas were also covered by a new multiclient 3D seismic acquisitions which also covered open acreage, as the South American nation prepares to host a competitive shallow-water bid round in the near future.

“Staatsolie has ensured that new 3D seismic data has been collected in these blocks so that proceeding to the interpretation of the subsurface can be smooth,” the company added.

Staatsolie’s 40% participating interest has been taken up through its subsidiary Paradise Oil Company (POC).

In its own statement on Tuesday, QatarEnergy said it will “own a 20% working interest in both blocks, where licensing of the new 3D seismic and associated exploration activities are planned”.

“The remaining working interest is shared equally between TotalEnergies (Operator) and Staatsolie’s affiliate, Paradise Oil Company,” it added.

QatarEnergy chief executive Saad Sherida Al-Kaabi said his company is pleased “to have concluded entry into blocks 6 and 8 along with its partners, TotalEnergies and Staatsolie” and is looking forward to commencing exploration in the promising basin.

The PSC for blocks 6 and 8 — which lie in water depths ranging between 40 and 65 metres — will be valid for a 30-year period, Staatsolie said.

Following the shallow water bidding round in 2021, Staatsolie has been negotiating PSCs with key winners.

It had earlier signed deals with Chevron and Shell for blocks 5 and 7, allowing oil exploration activities to begin.

QatarEnergy has entered into two PSCs for blocks 6 and 8 offshore Suriname, following successful bids in these blocks, as previously announced in June 2021.

TotalEnergies is already a leading player in Suriname, partnering APA Corporation on Block 58 in deep waters.

The partners say they areplanning major field development hub which will use a floating production, storage and offloading vessel to tap reservoirs with combined in-place resources of 800 million barrels of oil, but no clear indication yet of reserves.

Suriname’s 2022-2023 bid round will featuring six offshore blocks in the under-explored Demerara areato the north-east of the major discoveries made by TotalEnergies and partner APA Corporation.