Policy & Regulation

22 Jan 2022

Brazil, Guyana, Suriname Postpone Joint Energy Plan

22 Jan 2022  by   
The leaders of Brazil, Guyana and Suriname have postponed the creation of a regional energy corridor after Brazilian president Jair Bolsonaro left discussions early.

Bolsonaro, whose country's abundant pre-salt natural gas reserves would anchor the proposed corridor, returned to Brazil prematurely because of his mother's death.

The discussions on the Arco Norte project started in Suriname yesterday, and were to conclude in Guyana today, but "have been set back because president Bolsonaro has had to return home," a Guyanese government official told Argus today. No date for the resumption of talks has been set.

The talks included presidents Irfaan Ali of Guyana and Chandrikapersad Santokhi of Suriname.

Arco Norte would feature a gas pipeline network tied to industrial and petrochemical projects, such as a gas-fired aluminium smelter to process Guyana's bauxite ore.

The gas could come from offshore Guyana and Suriname that are emerging onto the hydrocarbons map, as well as Brazil.

Also on the agenda was an interchange of electricity, and a highway network connected to a planned deepwater port in Guyana, giving parts of northern Brazil access to the Atlantic.

Preferred access

Bolsonaro is looking to secure priority for Brazil's state-controlled Petrobras in the offshore Suriname play, which is geologically related to Brazil's offshore northern frontier.

During his 20 January meeting with his Suriname counterpart Santokhi, Bolsonaro said Petrobras could bring its deepwater expertise to the region.

Brasilia touts its offshore northern basins as its "new pre-salt", with around 40pc of the more than 20bn bl of oil equivalent (boe) discovered in pre-salt areas in the Campos and Santos basins.

Petrobras will spend around $2bn of the $5.5bn in planned exploration spending under its $68bn 2022-26 business plan on looking for oil in the Equatorial margin.

The company's upstream director Fernando Borges has said 14 wells at four offshore basins — Foz do Amazonas, Barreirinhas, Potiguar and Para-Maranhao — are believed to be connected to a trend in Suriname and Guyana.

Petrobras expects to receive authorization from environmental watchdog Ibama for drilling in Foz do Amazonas in the first half of 2022. BP and TotalEnergies exited exploration blocks in the region after the discovery of a nearby reef complicated licensing.

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