Guyana, Suriname Poised to Dominate LNG by 2030s

  • Based on large gas reserves in the Haimara cluster and Block 52, Guyana and Suriname could supply up to 12 million tonnes of LNG annually by the 2030s.
  • Low breakeven costs and high well productivity position these countries to compete with major suppliers like the US and Qatar, mainly for Southeast Asian markets.
  • Despite fiscal challenges, both countries are strategically important in closing the projected 105 mmtpa LNG supply gap by 2035, offering a new energy alternative in the region.

Guyana and Suriname could emerge as key players in the global liquefied natural gas (LNG) market by the 2030s, producing up to 12 million tonnes annually. Wood Mackenzie’s recent report underscores the significance of gas projects in both countries.

Large gas reserves in Guyana’s Haimara cluster and Suriname’s Block 52 (Sloanea) contain an estimated 13 trillion cubic feet (tcf) of non-associated gas. These reserves could drive the production of 12 million tonnes of LNG per year, meeting part of the global demand for LNG.

Low breakeven costs, around $6 per million British thermal units (FOB NPV10), make these projects economically competitive. High well productivity and the expertise of upstream partners in developing LNG add to this advantage. Guyana and Suriname could leverage these strengths as they enter the global LNG market.

Wood Mackenzie forecasts a 105 million tonnes per annum (mmtpa) global LNG supply gap by 2035. Countries need to make final investment decisions (FIDs) to meet this shortfall, and Guyana and Suriname’s projects could bridge part of the gap. Both countries enjoy a transportation cost advantage due to their proximity to the Caribbean and South American markets, positioning them as alternatives to the US and Qatar, which currently dominate the market.

An analyst at Wood Mackenzie, Amanda Bandeira, pointed to restrictions on new LNG export permits in the US, which could slow its export capacity growth. This slowdown allows Guyana and Suriname to meet LNG demand, particularly in Southeast Asia.

However, both countries face challenges that could delay progress. Even though the government reached a ten-year tax exemption deal, Suriname still needs to finalise fiscal terms for non-associated gas projects. This agreement could support the project’s start by 2031, but unresolved fiscal issues could cause further delays.

Guyana’s gas projects also face hurdles, with discussions around commercial structure and fiscal terms still in the early stages. If the government and upstream partners disagree, gas production could be delayed beyond the expected 2031 start date.

Despite these challenges, Guyana and Suriname are strategic players in the LNG sector. Their low-cost projects, backed by experienced operators, put them in a solid position to meet growing global LNG demand. Both countries could transform the South American and Caribbean energy landscape as energy markets evolve, supplying LNG to high-demand markets.

With global demand for LNG on the rise, the success of these projects could solidify Guyana and Suriname as major suppliers by the next decade. Their role in meeting future energy needs offers significant potential for the region’s economic growth and energy security.

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