Monday, February 1, 2016

Developments in Peru's hydrocarbons industry

Late last week, Peruvian state-owned oil company Petro-Peru signed a memorandum of understanding with the companies Pacific Exploration & Production and Pacific Stratus Energy del Perú regarding the exploitation of Lot 192, the largest oil field in Peru. Petro-Perú said in a press release that, “The signing of the memorandum is the first step in establishing a framework of cooperation between the signatories with the intention of exchanging technical knowledge, information, experiences, and practices related to oil and gas business opportunities.” According to the document, this agreement will facilitate future agreements regarding Lot 192.

Peru is looking to renegotiate not just its oil sector contracts, but also its agreements with natural gas producers and exporters, as the country is suffering from the low prices in the market. Peruvian President Ollanta Humala told the press that the country is renegotiating terms on blocks 55 and 57, and the Peruvian authorities are also looking to raise royalties on exporters and on gas suppliers to the Pampa Melchorita liquefaction plant. The article warned though that Peru’s prospects for a successful negotiation are slim, as the country does not have much bargaining power due to the troubled market.


In mining-related news, thousands of Peruvians took to the streets for a 72-hour strike to protest against HudBay Minerals’ open-pit copper mine. According to the report, the protest was only organized after invitations to the mining company and the government to discuss economic, social, and environmental issues, went unanswered.

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