Peru upstream oil, gas spend dips in Jan-Sep

Upstream hydrocarbons investment in Peru in the first nine months of 2022 slid 13% year-on-year to US$214mn, according to the latest numbers from oil and gas licensing authority Perupetro.

Exploration and production spend in the period fell 37% and 13%, respectively, to US$1.61mn and US$212mn, which is reflected in the level of field activity.

On the exploration front, 70km of 2D seismic was gathered in January-October versus 192km in the same period of last year.

In terms of drilling, 71 development wells were spud in the first 10 months of this year, compared with 105 development wells and one exploration well in January-October 2021.

For local mining, petroleum, and energy industry group SNMPE, one of the reasons for the spending shortfall would be the reluctance of companies that operate northwest blocks to invest due to the lack of government announcements related to the planned offering of their acreage, contracts for which are scheduled to expire in the near term.

Meanwhile, political turmoil and economic uncertainty and the lack of progress related to regulatory reform, along with socio-environmental conflict, continue to curb efforts to add new impetus to the sector.

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BLOCK 8

In a related development, lawmaker Jorge Luis Flores Ancachi of opposition party Acción Popular introduced a bill to congress to declare the reactivation of block 8 in the jungle region of Loreto to be of preferential national interest and public need.

The legislative proposal looks to fast-track the signing of the contract for the block by not requiring prior consultation due to agreements reached between the state and indigenous communities, according to the bill.

Read Perupetro successfully concluded face-to-face citizen participation events for lot 8 in Loreto

The government plans to offer block 8, which covers 182,348ha, after Pluspetrol Norte announced its departure from the block in 2020 following a years-long environmental dispute.