b'STAATSOLIE MAATSCHAPPIJ SURINAME N.V.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2019 (Continued)Defined benefit plans (pension benefits) usingassumptionsastothenumberofwellsThecostofdefinedbenefitpensionplansandother requiredtoproducethecommercialreserves,post-employmentmedicalbenefitsandthepresent thecostofsuchwellsandassociatedproductionvalueofthepensionobligationaredetermined facilities,andothercapitalcosts.usingactuarialvaluations.Anactuarialvaluation TheeconomictestsfortheDecember31,2019involvesmakingvariousassumptionswhichmay reservevolumeswerebasedonafutureprojectiondifferfromactualdevelopmentsinthefuture.These of crude oil prices using crude oil prices forecasted includethedeterminationofthediscountrate, byPIRAEnergygroupasthereferenceprice.futuresalaryincreases,mortalityratesandfuturepensionincreases.Duetothecomplexityofthe AveragepriceofactualcrudesalesandthePIRAvaluation,theunderlyingassumptionsanditslong- pricepremisefor2019arethesamerequiringnotermnature,adefinedbenefitobligationishighly adjustmentforpricedifferential.Thesameoilpricesensitivetochangesintheseassumptions.All premisewasappliedforallreservecategorieslessassumptionsarereviewedateachreportingdate. atransferpremium.Anaverageshrinkagefactorof0.44%(2018:1%)wasappliedtocapturelossesinTheparametermostsubjecttochangeisthe deliveryofcrudetotherefinery.discount rate. In determining the appropriate discountrate,managementconsiderstheinterest AveragepricedifferentialbetweenthePIRAcruderatesofgovernmentbondsincurrenciesconsistent priceforecastandaveragepostingpriceofthewiththecurrenciesofthepost-employmentbenefit Groupscrudeoilin2019wasUS$4.13/Bbl.(PIRAobligationwithatleastanAAratingorabove, US$57.82/Bbl.versusactualUS$53.69/Bbl.).assetbyaninternationallyacknowledgedrating Thelong-termPIRAcrudeoilpricesusedintheagency,andextrapolatedasneededalongthe estimationofthecommercialreservesarelistedinyieldcurvetocorrespondwiththeexpectedterm thetablebelow.ofthedefinedbenefitobligation.Theunderlyingbondsarefurtherreviewedforquality.Thosehavingexcessivecreditspreadsareremovedfrom YearUS$/Bbltheanalysisofbondsonwhichthediscountrateisbased,onthebasisthattheydonotrepresenthigh 2020 64.36qualitybonds. 2021 56.73Themortalityrateisbasedonpubliclyavailable 2022 53.01mortalitytablesforthespecificcountries.Thosemortalitytablestendtochangeonlyatintervalsin 2023 49.85responsetodemographicchanges.Futuresalary 2024 50.30increases and pension increases are based on expectedfutureinflationratesfortherespective 2025 53.79countries.FurtherdetailsaboutpensionobligationsareprovidedinSection4.9. 2026 55.08Hydrocarbon reserve and resource estimates 2027 56.69Hydrocarbonreservesareestimatesoftheamount 2028 58.22of hydrocarbons that can be economically and2029 59.88legallyextractedfromtheGroupsoilproperties.TheGroupestimatesitscommercialreserves 2030 61.66and resources based on information compiled byappropriatelyqualifiedpersonsrelatingtothe 2031 63.31geologicalandtechnicaldataonthesize,depth, 2032 64.78shape and grade of the hydrocarbon body and suitableproductiontechniquesandrecovery 2033 66.28rates.Commercialreservesaredeterminedusingestimatesofoilinplace,recoveryfactors 2034 67.80andfuturecommodityprices,thelatterhaving 2035 69.36animpactonthetotalamountofrecoverablereservesandtheproportionofthegrossreserves 2036 70.95thatareattributabletothehostgovernmentunderthe terms of the production-sharing agreements2037 72.56(PSAs).Futuredevelopmentcostsareestimated58 STAATSOLIE 2019 ANNUAL REPORT'