🏢 Bronto Somohardjo resigns

Happy Monday!

This week we discuss Bronto Somohardjo’s resignation, privatization of state owned company SAIL, and Petronas’ interest in Block 52.

Breaking: Bronto Somohardjo resigns

• Vice President Ronnie Brunswijk declared that Minister Bronto Somohardjo of Home Affairs, also vice chairman of PL, has declared war on him.

• Brunswijk stated that agreements with Pertjajah Luhur (PL) no longer apply.

• Brunswijk now collaborates with PDO, Nieuwe Stijl KTPI, and the Democrats of Suriname, distancing from PL.

• Minister Somohardjo has been on leave while an investigation by CLAD is ongoing at his ministry.

• President Chan Santokhi had initially indicated that the CLAD investigation should conclude within a week.

• Several names were considered as possible replacements for Somohardjo, but no decision has been made yet.

• Somohardjo refrained from commenting due to an agreement of silence with the president.

• After a closed meeting, tensions between Brunswijk and Somohardjo seemed to ease, but Brunswijk remained critical of the PL.

• The strained relationship between Brunswijk and Somohardjo led to Somohardjo offering his portfolio to the president and resigning this friday.

• Somohardjo stressed that his decision was in the best interest of the country and governance, given the discord with Brunswijk.

• Pertjajah Luhur is expected to nominate the next Minister of the Interior, and an emergency meeting will be held at the PL Party Centre.

Private sector organizations in support of privatization of sails, employees strike

• The Suriname Business Association (VSB) supports privatization under strict conditions, including transparency and employee rights.

• Privatization of state-owned companies is part of broader economic reforms for a more efficient economy and increased private sector involvement.

• The government aims to reduce its financial burden by privatizing non-essential state-owned companies, while retaining strategic ones like Staatsolie and Surinamese Aviation Company.

• Privatization, such as the case with SAIL, raises concerns about transparency, governance, and employee rights, as seen in recent incidents.

• Employees of SAIL learned about its planned privatization through social media, leading to concerns about their job security.

• International standards for fair privatization stress the importance of public consultation and stakeholder involvement, which the government has been criticized for lacking.

• VSB emphasizes the need for clear processes and employee protections in any privatization effort to ensure social acceptance and legitimacy.

• A major risk of privatization is inadequate protection for employees, as seen in the handling of SAIL, creating uncertainty and mistrust.

• The government plans to privatize 30 state-owned companies but has faced criticism for a lack of transparency, especially regarding which companies will be sold.

• SAIL employees recently met with the Minister of Agriculture, who clarified the company would be privatized, not sold, and promised further communication to address concerns.

Petronas working on FID Block 52 gas development

• Petronas is expected to make a Final Investment Decision (FID) for Block 52 in Suriname, where it holds a 50% stake alongside ExxonMobil.

• Block 52 has three major oil discoveries, including Fusaea-1 and Roystonea-1, containing around 400 million barrels of oil.

• Petronas plans to drill two more exploration wells by 2025 to increase volume for oil development, aiming for an FID by 2027.

• Oil production from Block 52 could begin around 2030, with a possible processing capacity of 100,000 barrels per day using a floating production storage and offloading (FPSO) vessel.

• Petronas has signed a Letter of Agreement with Staatsolie, securing a 10-year tax-free period from the start of gas production.

• Suriname’s first standalone gas project, potentially starting by 2031, may include a floating liquefied natural gas (FLNG) project.