Petroperú readying public share offer

Details of a planned public share offer by Peru’s national oil company Petroperú are due to be released next quarter.

The valuation of the company and preparatory actions for the transaction should be presented in October, the NOC said in an update.

The share offer falls within the framework of law 30130, which declares the upgrade of the Talara refinery and the strengthening of Petroperú of public necessity and national interest.

In addition, the share offer is part of commitments assumed by the state operator under its restructuring plan to strengthen governance and ensure financial and operational sustainability.

Arthur D. Little and Columbus HB Latam helped prepare the plan, which was just approved by Petroperú’s board.

Local paper La República reported that it gained access to the consultants' document, which considers the company's return to the upstream essential due to blocks that have high production and extensive reserves.

In a new report, S&P Global Ratings said that “Petroperu has underperformed expectations, exacerbating its weak capital structure and leading us to revise downward our base case, putting pressure on the ratings.”

S&P points to the company’s “severe management and governance deficiencies in 2022 that hurt its reputation and liquidity,” and expects the NOC “to burn cash again in 2023, making government support increasingly necessary.”

Recently, Apoyo & Asociados maintained Petroperú ratings at 'CP-1-(pe)' and 'AA-(pe)' but revised the outlook to negative from stable, while Pacific Credit Rating modified its ratings to '_PEE' from '_PE1' and '_PEAA'.

Petroperú, which posted a US$158mn net loss in the first quarter, has said that it “faces aggressive competition.”