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A total 94 wells were drilled in Peru last year, the lowest count since 2006 when 86 wells were spud, according to BNamericas research.
Of the wells started in 2013, 85 were development, two confirmation and seven exploration compared to 197 development, two confirmation and nine exploration wells in 2012, data from state hydrocarbons promotion agency Perupetro reveals.
Companies that drilled wells in 2013 were BPZ Energy (3), Cepsa (1), GMP (16), Gran Tierra Energy (2), Olympic (39), Pacific Stratus Energy (1), Perenco (9), Petrobras (1), Pluspetrol (3) and Savia (21).
Seismic acquisition last year also slid with 2D and 3D work totaling 1,168km (seven year low) and 2,040km2 (six year low); 2D and 3D shoots in 2012 reached 1,333km and 2,393km2.
Last year's 2D seismic was shot in the northern jungle area by Pacific Stratus Energy (block 135, 788km) and Gran Tierra Energy (block 95, 380km).
Moche Energy and BPZ Energy acquired 1,611km2 and 429km2 3D seismic, respectively, off Peru's northern coast. Moche carried out the work on block Z-46 and BPZ on block Z-1.
No E&P contracts were signed in 2013 as was the case in 2012 with the last contracts (5) signed in 2011. The number of contracts at end-2013 reached 74 (24 in production, 50 in exploration) versus 80 (20 in production, 60 in exploration) year on year.
Increased socio-environmental scrutiny would be behind the activities dip with force majeure in effect for 32 contracts in November. And of 139 active and latent socio-environmental conflicts registered in December, 17 were from the hydrocarbons sector.
Another prohibitive factor would be higher costs as the E&P frontier extends beyond traditional areas and related security issues.
Think tank Instituto Peruano de Economía adds that "information available for those interested in exploring also should be significantly improved before they are assigned blocks."
"Reforms announced by the government in 2013 aim at reducing excessive paperwork and facilitating faster granting of permits. However, due to limitations in capacity implementation, these reforms are likely to require time to take effect," highlights IMF.
Exploration and production investment in January-November 2013 totaled US$438mn and US$813mn, respectively, compared to US$947mn and US$933mn for all of 2012.
For a BNamericas review of hydrocarbons production, go to this link.