Govt signs off on Petroperu bond issue

Peru

LIMA, May 8, 2017 – Petroperu has been given the green light to issue bonds to the tune of USD 2 billion, an entry in Peru’s official gazette on Sunday said.

While significant, the bond issuance is lower than the state-owned entity had been targeting. Last month, it said it was seeking USD 3 billion.

The proceeds will be used for the Talara refinery upgrade project.

In related news, Petroperu on Friday said it was mulling a tie-up with Pacific Exploration & Production of Canada for a field development project.

According to Petroperu Chief Executive Luis Garcia Rosell, the efforts will centre on lot 192 in the Amazon region. Pacific’s concession will expire in 18 months, and a partnership with the NOC would secure continued investment in the resource.

“Pacific will not make larger investments if they don’t see a possibility of extending the therm. But if we [Petroperu] participate […] the situation would change and they would begin to make investments,” Rosell was quoted as saying.

The 5,000-square-kilometre lot near the border with Ecuador used to produce between 10,000 and 12,000 bopd. Pipeline spills and tensions with indigenous communities last year prompted Peru to close the conduit used to transport the field’s crude, necessitating a halt in operations.