Government designs terms to attract international investment.

The nation of Suriname on the shoulder of South America would like offshore oil production to supplement its income from onshore properties, and it has set a new bidding round to bring those properties to the international investment community.

Data packages for the offshore properties are available now with a bid deadline set for May 24 this year. Companies will meet with the bid evaluation committee on June 10, and Suriname plans to award the blocks on July 2, Marny Daal-Vogelland, manager of exploration and development contracts for the nation, said during a presentation meeting in Houston.

For the winners, the production sharing contract is the binding law, superceding subsequent national changes in taxation, she said. A royalty kicks in, but only after the operator recovers exploration, development and production costs. That royalty hasn't yet been officially set, but that government has asked the legislature to set the rate at 6.25%.

Among other terms, operators also face a 36% income tax but there are no bonuses, no levies on imports, no taxes on imports and no rental fees. Operators also may freely move money to the currency of their choice.

The nation will charge a US $10,000 fee for the bid package, but that contains seismic data, well files and logs and gravity and magnetic survey information.

Winning bidders will get a phased exploration period of 5 years. As an example of how they might use that time, Daal said, they might collect 621 miles (1,000 km) of 2-D seismic in the first year and a half (phase 1), add 3-D seismic in the second year and a half (Phase 2) and drill an exploratory well by the end of the fifth year.

Companies that find oil or gas can expect state oil company Staatsolie to back in for up to 15%.
WesternGeco recently completed a 3,478-mile (5,600-km) 2-D seismic survey over the shelf, including 2,745 miles (4,420 km) of marine streamer data, 404 miles (650 km) of ocean-bottom cable data and 348 miles (560 km) of deep offshore data around the Demarara High. That data fills in gaps between Suriname's 2001 bidding round and the present, WesternGeco's Chris Verret said.

Most of the blocks are in less than 164 ft

(50 m) of water, and the company has done depth migration work. "The source rock is world class," he said.

Dr. Eddy Jharap, managing director of Staatsolie, said the company was formed after Gulf Oil looked at an onshore prospect and decided it was too small for Gulf, but it might be a good project for the government. That discovery was Tambaredjo, a field with 900 million bbl of oil in place that still produces 12,000 b/d of oil from 650 wells to the country's refinery.

Staatsolie will begin developing its 15-million-bbl Calcutta onshore field next year and it plans to drill on its third prospect, Nickerie, in 2005.

The whole country, onshore and offshore, has 15 billion bbl of potential reserves, he added.
He briefly mentioned an incident in which a Suriname gunboat chased away an offshore rig preparing to drill in disputed water on the country's western border with Guyana. The two countries are trying to settle on a boundary line, he said, but none of the blocks in this bidding round is in the disputed area.
Most of the Guyana Basin - which includes tracts on- and offshore Suriname - is offshore. The industry has long recognized that the basin has potential and drilled wells in the 1960s, 1970s and 1980s looking for an offshore equivalent of Tambaredjo, Dr. Bert Dijksman, team leader for exploration with Staatsolie, said.

The Demarara High contains good-quality carbonates, Dijksman said, and a series of faults extend off the high into the basin to the west. "This is an important flexure zone," he said.

Examining prospects and leads in the bidding blocks, Dijksman said 22 wells have been drilled offshore, and Staatsolie has logs on most of those wells. Among existing fields, Tambaredjo produces from late Cretaceous rock and Calcutta produces from Eocene-age sediments. Source rocks appear to be early Cretaceous. Both fields produce from stratigraphic traps, and the same kinds of traps should extend to offshore fields.

The Demarara High offers structural traps. It appears that the sediments eroded from the Demarara Plateau into the basin toward shore.

Since the sand in the basin came from the Demarara Plateau, canyons should provide channels, and seismic backs up that assumption, he said.

On the shelf toward the east, seismic shows good amplitude anomalies with sediments 3,500 to 4,000 ft (1,067 m to 1,220 m) thick with clear wedges. Wedge 1 is 12,304 ft (3,750 m) deep. It's a 243-sq-mile (630-sq-km) area of high amplitude with 66 ft (20 m) of reservoir thickness and a potential 950 million boe in place, he said.

Wedge 2 lies at a depth of 10,171 ft (3,100 m), covers a 166-sq-mile (430-sq-km) area with sediments also 66-ft (20-m) thick and 650 million potential bbl of oil in place.
In addition, the shelf holds a number of stratigraphic traps with six or seven anomalies with a potential of 3 billion bbl of oil in place. The Demarara High structural traps could hold another 1 billion bbl of oil, he said.

Suriname is working to welcome new companies into its oil and gas industry, Daal added, because 90% of its fields are older than 25 years, it wants to find more production and it has 117 potential fields to draw interest. About 24 of those fields have potential reserves of more than 100 million bbl, she said, and six have potential for more than 500 million bbl.

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