Peru, Camisea Gas Operators Reach Domestic Supply Accord

Peru’s government reached an accord with the operators of its largest natural-gas fields that ensures domestic supplies and shouldn’t endanger future investment, company and government officials said.

The seven-company Camisea Group will seek reserves in neighboring fields to complement Block 88, which will be devoted exclusively to domestic supplies, operator Pluspetrol SA’s country manager German Jimenez said today at a televised ceremony at the gas fields after signing an agreement that ended eight months of negotiations.

President Ollanta Humala was elected last year on pledges to give priority to local power plants and petrochemical projects before exports to Mexico. Lack of gas supply is delaying $16 billion in investment projects by companies such as Duke Energy Corp. (DUK), CF Industries Holdings Inc. (CF) and Orica Ltd. (ORI), according to the National Society of Mining, Petroleum & Energy.

“We agreed on our future interests through dialogue, without any need for drastic measures,”Humala said at the same ceremony. “The construction of the gas pipeline and the petrochemical cluster are on track thanks to the fact we now have Block 88.”

Peru’s oil and gas exports jumped by 50 percent to $5 billion last year after a separate group including Hunt, Repsol YPF SA (REP) and SK Group of South Korea started a $4 billion liquefied natural-gas export plant.

To contact the reporter on this story: Alex Emery in Lima at aemery1@bloomberg.net

To contact the editor responsible for this story: Dale Crofts at dcrofts@bloomberg.net.