b'STAATSOLIE MAATSCHAPPIJ SURINAME N.V.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2020 (Continued)expenditure estimates change. Changes to proveHydrocarbon reserve and resource estimatesreserves could arise due to changes in the factors orassumptionsusedinestimatingreserves, Hydrocarbon reserves are estimates of the amount including: of hydrocarbons that can be economically and legallyextractedfromtheGroupsoilproperties.Theeffectonprovedreservesofdifferences TheGroupestimatesitscommercialreservesbetween actual commodity prices and commodityand resources based on information compiled price assumptions. byappropriatelyqualifiedpersonsrelatingtothe Unforeseen operational issues. geologicalandtechnicaldataonthesize,depth,shape and grade of the hydrocarbon body and Defined benefit plans (pension benefits) suitableproductiontechniquesandrecoveryrates. Commercial reserves are determined Thecostofdefinedbenefitpensionplansandother usingestimatesofoilinplace,recoveryfactorspost-employmentmedicalbenefitsandthepresent andfuturecommodityprices,thelatterhavingvalue of the pension obligation are determinedan impact on the total amount of recoverable using actuarial valuations. An actuarial valuationreserves and the proportion of the gross reserves involves making various assumptions which maythat are attributable to the host government under differfromactualdevelopmentsinthefuture.These the terms of the production-sharing agreements includethedeterminationofthediscountrate, (PSAs).Futuredevelopmentcostsareestimatedfuturesalaryincreases,mortalityratesandfuture using assumptions as to the number of wells pension increases. Due to the complexity of therequiredtoproducethecommercialreserves,valuation,theunderlyingassumptionsanditslong- the cost of such wells and associated production termnature,adefinedbenefitobligationishighly facilities,andothercapitalcosts.sensitive to changes in these assumptions. AllTheeconomictestsfortheDecember31,2020assumptions are reviewed at each reporting date. reservevolumeswerebasedonafutureprojectionTheparametermostsubjecttochangeisthe of crude oil prices using crude oil prices forecasted discount rate. In determining the appropriatebyPIRAEnergygroupasthereferenceprice.discountrate,managementconsiderstheinterest AveragepriceofactualcrudesalesandthePIRArates of government bonds in currencies consistentpricepremisefor2020arethesamerequiringnowiththecurrenciesofthepost-employmentbenefit adjustmentforpricedifferential.ThesameoilpriceobligationwithatleastanAAratingorabove, premise was applied for all reserve categories less as set by an internationally acknowledged ratinga transfer premium. An average shrinkage factor agency,andextrapolatedasneededalongthe of0.78%(2019:0.44%)wasappliedtocaptureyield curve to correspond with the expected termlossesindeliveryofcrudetotherefinery.ofthedefinedbenefitobligation.Theunderlyingbondsarefurtherreviewedforquality.Those AveragepricedifferentialbetweenthePIRAcrudehaving excessive credit spreads are removed fromprice forecast and average posting price of the the analysis of bonds on which the discount rate isGroupscrudeoilin2020wasUS$0.71/bbl(PIRAbased,onthebasisthattheydonotrepresenthigh US$43.15/bbl.versusactualUS$43.86/bbl.).qualitybonds.Themortalityrateisbasedonpubliclyavailable (2019wasUS$4.13/bbl:PIRAUS$57.82/bbl.mortalitytablesforthespecificcountries.Those versusactualUS$53.69/bbl.)mortality tables tend to change only at intervals in response to demographic changes. Future salary increases and pension increases are based on expectedfutureinflationratesfortherespectivecountries. Further details about pension obligations areprovidedinSection4.9.73'