Guyana and Suriname could provide 12 mmtpa of cost-competitive LNG in the 2030s

Several gas developments are underway in Guyana and Suriname that could offer new competitive LNG supply sources early next decade, according to a new report from Wood Mackenzie.

According to Wood Mackenzie’s report “Can Guyana and Suriname LNG compete against new global supply?”, Guyana and Suriname could supply up to 12 million metric tonnes per annum (mmpta) of LNG by the next decade.

Guyana's Haimara cluster and Suriname's Block 52 (Sloanea) are estimated by Wood Mackenzie to hold 13 trillion cubic feet (tcf) of discovered non-associated gas. These sources could deliver this potential LNG supply at a breakeven, excluding shipping and regasification costs, of about US$6/mmbtu (FOB NPV10 breakeven). The positive economic results are supported by high well productivity and upstream partners experienced in LNG commercialisation.

This comes at a time when the global market still needs 105 mmtpa of pre-final investment decision (pre-FID) LNG to fill the supply/demand gap by 2035, according to the report.

“Guyana and Suriname projects are firming up at an interesting time,” said Amanda Bandeira, research analyst, Latin America Upstream Oil and Gas for Wood Mackenzie. “US and Qatar LNG dominance is rapidly growing, but there is a supply window in the mid-2030s coming in part from the US President Biden's pause on approving new US LNG export projects.

“In this environment, Guyana and Suriname can offer a new cost-competitive LNG supply source and serve as regional suppliers, holding shipping costs advantage to address Caribbean and South American demand. They are also on par with US Gulf and West Africa projects to deliver to the main demand centres in Southeast Asia.”

However, these developments face uncertainty as commercial structure and fiscal terms remain unclear.

“In Suriname, there is still no set terms for non-associated gas developments, but we expect this project to move forward swiftly – with first gas in 2031 – as the government and project partners have agreed to a 10-year tax break,” said Luiz Hayum, principal analyst, Latin America Upstream. “In Guyana, the government and upstream partners alignment on fiscal terms and commercial structure are less advanced, and any disputes could delay the project first gas beyond 2031.”