GOLDEN LANE INVESTMENTS ADVISORY GROUP

GLIAG STRATEGIC INTELLIGENCE NOTE

Suriname’s First Gas Test

Why the Sloanea Tax Holiday Is About Project Bankability, Not Tax Reduction

Drs. M.P.T. Chin-A-Lien, MBA, M.Sc., Ing. Geologist – 2nd July 2026

Founding Partner & Chief Architect — GLIAG, Golden Lane Investments Advisory Group

Certified Professional Geologist Nr. 5201-1996 (AAPG)  ·  Chartered European Geologist Nr. 92-1996 (EFG)  ·  Energy Negotiator, June 2021 (AIEN)

2 July 2026

EXECUTIVE INSIGHT

At first glance, Suriname’s ten-year tax holiday for the Sloanea gas development appears to reduce future government revenue. It does — but only in the early years. The question that actually matters is whether a commercial project would have existed at all without it. The tax holiday should be read as a bankability instrument, not a fiscal concession.

Facts First

The Government of Suriname, Staatsolie, PETRONAS and ExxonMobil agreed to a special fiscal arrangement to facilitate commercialization of the Sloanea gas discovery in Block 52. The agreement includes a ten-year income tax holiday from first production, the existing offshore royalty structure, development through an FLNG concept, continued Staatsolie participation through Paradise Oil Company, and the shared objective of reaching Final Investment Decision (FID). Reporting on the arrangement noted that the holiday was introduced because the gas development had initially been assessed as commercially challenging.

Reading the Screening Model

The underlying model should not be mistaken for a field development plan. It is a transparent engineering-economic screening exercise built from publicly available information. Five elements deserve particular attention.

1. The Production-Depletion Profile Is Facility Constrained

The production plateau is set by the capacity of a 2.0 mtpa FLNG facility, not by an assumed reservoir limit. The reservoir may well be capable of producing considerably more gas — the facility determines how much can actually be processed and sold. This distinction separates resource potential from commercial throughput.

2. The Total Gas Requirement

Sustaining the assumed profile over twenty years would require approximately 2 Tcf of feed gas. That figure does not represent a reserves estimate for Sloanea — it represents the volume of recoverable gas that must ultimately be available to support a development of this shape, with additional reserves needed for operational flexibility, maintenance, uncertainty, and future expansion.

3. Revenue Follows Production

Annual revenue tracks the production profile rather than remaining flat: it rises through ramp-up, stabilizes at plateau, and declines with the field. This is standard petroleum engineering practice — cash flow follows production, not the reverse.

“The tax holiday does not affect royalty. It only postpones corporate income tax during the agreed fiscal period — government continues to receive royalty, Staatsolie participation, local economic activity, and future taxes once the holiday expires.”

4. What the Tax Holiday Actually Changes

Royalty continues throughout. Only corporate income tax is deferred, and only for the agreed period — a narrower instrument than it is often assumed to be.

5. Why Contractor Cash Flow Matters

Governments typically optimize for government take; investors optimize for project value. Development proceeds only when the two become compatible. By increasing contractor cash flow during the highest-risk investment years, the tax holiday improves financing terms, debt service capacity, project IRR, investment attractiveness, and ultimately the probability of reaching FID.

GLIAG STRATEGIC OBSERVATIONS

• Trinidad reduced marginal gas royalty to 8% as mature offshore gas fields became economically marginal.
• Suriname already applies a lower offshore royalty but instead chose a targeted tax incentive for first-gas commercialization.
• The two countries pursue different fiscal mechanisms for different geological circumstances — the objective in both cases is identical: convert stranded gas into producing gas.

What This Means for Block 52

Successful progression of Sloanea would reduce geological risk, increase commercial confidence, make additional gas appraisal more attractive, ease the aggregation of nearby discoveries, and strengthen the case for FLNG expansion. In effect, Block 52 would evolve from an exploration block into a gas development province.

What This Means for Suriname

The greatest value of the tax holiday is not lower taxes. It is the increased probability that Suriname’s first offshore gas project actually happens. A project that never reaches FID produces no royalty, no employment, no local content, no Staatsolie cash flow, no domestic gas option, and no industrial development. A commercial project produces all of these.

GLIAG CONCLUSION

The Sloanea fiscal package should not be judged solely by the taxes temporarily deferred. It should be judged by the national value it unlocks. If it enables Suriname’s first commercial deepwater gas project, accelerates FLNG development, stimulates further exploration in Block 52, strengthens Staatsolie’s long-term participation, and lays the foundation for a future Gas-to-Shore option, its economic return extends far beyond the early revenue it temporarily defers.

Petroleum discoveries create resources. Commercial projects create cash flow. Strategic fiscal architecture converts both into sovereign value.

This analysis is based on publicly available information and transparent screening assumptions. It is intended as a strategic engineering-economic assessment and does not constitute a reserves certification, field development plan, investment recommendation, or valuation. Final project economics depend on certified reserves, well performance, engineering design, commercial agreements, financing, and approved fiscal terms. GLIAG is an independent strategic advisory platform and holds no commercial interest in Block 52.

© 2026 GLIAG — Golden Lane Investments Advisory Group. All rights reserved.

Soso Lobi.