AGM approves 2023 Annual Report

The General Meeting of Shareholders (AGM) approved the Annual Report 2023 on Monday, May 6, 2024. During the meeting, the appointment of Eddy Fränkel as statutory board member with effect from 6 May 2024 was ratified. In 2023 a consolidated revenue of US$722 million was achieved and US$335 million has been contributed to the Government of Suriname.

For Staatsolie and its subsidiaries GOw2 Energy Suriname N.V. and Staatsolie Power Company Suriname N.V. (SPCS), 2023 has been a good year. Production targets have been met or exceeded, while important milestones were achieved in the offshore. At the AGM, which was attended by President Chandrikapersad Santokhi as a representative of the shareholder, the 2023 operating results and the outlook for the coming years were presented by the board. The AGM also announced the appointment of Eddy Fränkel as statutory board member with effect from 6 May 2024. Fränkel has been Deputy Director at Staatsolie since 2019 and will act as Downstream & Power Director from 6 May. The Downstream & Power Directorate includes the refinery and electricity operations.

Financial Results

In 2023, Staatsolie and its subsidiaries GOw2 and SPCS achieved a consolidated gross revenue of US$722 million (This amount also includes the participation in the gold mines of Newmont Suriname LLC and Rosebel Gold Mines N.V.). In 2022 this was US$840 million. The decrease is the result of a lower average oil price of US$77 in 2023 compared to US$93 per barrel in 2022. Pre-tax profit is US$426 million (2022: US$430 million).

Payments to the government

Despite the lower oil price, the contribution to the Government of Suriname increased by US$15 million to US$335 million (US$320 million in 2022). This payment consists of various taxes, dividends and royalties from Staatsolie's participation in gold mines and partly from bonuses received for signing various offshore production sharing contracts. In addition to dividends and taxes, Staatsolie and its subsidiaries contribute to society by investing in community projects. In 2023, approximately US$1.8 million will have been spent on these projects, which mainly focused on education, young people, seniors and healthcare. Our offshore partners have also spent approximately US$1.5 million on social projects, as agreed in the production sharing contracts with Staatsolie.

* Earnings before interest, taxes, depreciation and amortisation

Production Results

In 2023, 6.27 million barrels of Saramacca Crude has been produced. In 2022, production was 6.14 million barrels. The Staatsolie refinery produced 3.16 million barrels of high-quality diesel and gasoline, achieving the set goals.

Subsidiary SPCS has generated approximately 1.60 million MWh of electricity compared to 1.47 million MWh in 2022. Of this number, approximately 1.2 million MWh has been generated by the Afobaka hydropower plant and approximately 0.4 million MWh by the thermal power plant. Subsidiary GOw2 has had significant growth in its retail market share in 2023, from 39% to 65%. The expansion and renovation of the GOw2 pump stations will continue in the coming years. This started in 2022.

Offshore

In September, Patrick Pouyanné, CEO (and chairman of the supervisory board) of TotalEnergies, announced the start of preliminary design studies for the development of the first offshore production field in Block 58 during his visit to Suriname. The announcement came after successful assessment of the block's two major oil discoveries, Sapakara South and Krabdagu, confirming reserves of approximately 700 million barrels in both wells combined. In 2023, five Production Sharing Contracts (PSCs) have been signed with international oil companies. Two of these are for blocks in the shallow offshore, which were offered in the “Shallow Offshore Bid Round 2020-2021”. The three other PSCs are for blocks that were part of the “Demerara Bid Round 2022-2023”. The “Shallow Offshore 2 Bid Round 2023-2024” started in November 2023 and will close on 31 May 2024. Eleven shallow offshore blocks are offered for exploration in this round.

Local Content

Staatsolie is committed to the development of local content in the emerging Surinamese offshore oil and gas industry. The Blue Wave training program, an initiative of Staatsolie, provided insight and tools to local companies on how to bring their business processes and standards to an internationally required level. The program was completed in 2023 and will continue for a second edition this year. Staatsolie also encourages its offshore partners to purchase goods and services locally wherever possible. This is also included in the production sharing contracts. In 2023, offshore partners and their contractors have spent US$59 million in Suriname on goods and services. In 2022 this was US$98 million. Spendings are mainly influenced by the number of wells that are drilled. In 2023 this was four wells and in 2022 eight wells.

Outlook

Developments in the offshore sector will continue to dominate 2024 and the years to come. According to plan, TotalEnergies will make the Final Investment Decision for a production field in Block 58 at the end of 2024. Staatsolie plans to take advantage of the opportunity to participate for twenty percent in the developments in Block 58. The options for financing are being researched and prepared. PETRONAS and its partner ExxonMobil will continue exploration activities in Block 52. In March 2024, Staatsolie and the Block 52 partners signed a Letter of Agreement (LoA) for further investigation of the gas discovery made in 2020 with the Sloanea-1 exploration well. The Fusaea-1 exploration well was drilled in the first quarter of 2024, after which drilling of the Sloanea-2 appraisal well started. A production test will be carried out on the Sloanea-2. After drilling this well and subsequent research, it will become clear whether a commercial gas field is feasible.

Staatsolie looks ahead with confidence and will continue to contribute to a bright future in accordance with its vision 'Energizing a bright future for Suriname'. We thank all our stakeholders for their contribution to the achieved successes: the shareholder, supervisory board, employees, suppliers, offshore partners, financiers, investors and customers.

The Annual Report Summary 2023, can be read here.