Suriname's state-owned oil company Staatsolie is planning an international roadshow as it eyes ways of financing its own participation in giant offshore developments following Apache’s spectacular discoveries on Block 58.

Suriname’s production-sharing contracts allow Staatsolie to opt into stakes of up to 20% in oilfield development projects, but it must pay its way.

“There has been a lot of discussion about how we are going to come in for 20%. There are a number of scenarios, and lots of interest from potential backers. One thing is sure, we will be taking our seat at the table,” says Staatsolie chief executive Rudolf Elias.

Options include accessing capital markets, bank loans or private financing, Elias says.

Staatsolie has also been in contact with leading stock markets about the feasibility of floating part of the company in an initial public offering.

Toronto Stock Exchange is seen as the leading candidate, but New York, London and Amsterdam are also in the frame.

The amount of cash that Staatsolie will need to raise will ultimately depend on values reflected in future declarations of commerciality and final investment decisions.

Verisk Maplecroft consultancy has estimated the cost of the desired 20% stake at between $1.5 billion and $2 billion, and put future development costs between $6 billion and $7 billion.

Given the scale of the discoveries on Block 58 — early estimates point to at least five floating production units — Staatsolie may seek to vary the size of its stake along the way.

“We might not be in for 20% for every stage of development, but in the first one I can guarantee we will come in for the full 20%. And we will certainly participate in all of them," Elias says.

Staatsolie is planning to appoint financial advisers this year and will stage an international roadshow to promote the project.

“We are keeping all our options open at this stage, and this has included developing close contacts in the Middle East and the Far East, where there is a lot of interest,” Elias says.

The clock is ticking for Staatsolie which, for all its virtues as an oil producer and a regulator, is not known for moving quickly.

The establishment of commerciality on the Block 58 discoveries will trigger a one-year period in which Staatsolie will have to decide on its participation.

“We are gaining significant momentum. It is absolutely critical to us that any decisions we take are not done in a way that could delay the project or deter investors from coming to Suriname,” says Staatsolie offshore vice president Brian Glover.

"Staatsolie has been preparing so much for this. The team is well versed in what needs to be undertaken," he adds.

An IPO option would probably be used to underpin a later phase of development rather than a stake in the first phase, says Elias.

Focus

Suriname's state oil player seeks financing for offshore oil development role in hot spot