Exxon, Apache Look to Bid on Peru's Offshore Oil, Gas Blocks

By MarEx 2013-03-26 09:35:00

Exxon Mobil Corp., Apache Corp., and other U.S. companies are looking to acquire offshore blocks in Peru this year in the country’s first bidding round since 2010, a government official said.

The government will also auction Argentine firm Pluspetrol SA’s Block 1-AB, Peru’s largest oilfield, as it’s due to expire in 2015, said Luis Ortigas, president of state oil-contracting agency Perupetro. State oil company Petroperu will take an approximate 25 percent stake in all blocks, he said.

“Companies have shown increasing interest following offshore discoveries by BPZ and Savia,” Ortigas told reporters in Lima. “We need to increase the number of exploration wells being drilled to 40 or 50 a year from about six now.”

Peru, which produced 173,600 barrels of oil and gas liquids a day through February, has lined up $20 billion in energy projects through 2018 in a bid to double oil and gas output, according to the Energy Ministry. Crude oil output has dropped 20 percent during the past decade as oilfields are depleted.

Exxon Mobil doesn’t “speculate on future plans,” David Eglinton, a Houston-based spokesman, said in an e-mailed response to questions.

“Apache is always scrutinizing exploration possibilities worldwide,” John Roper, an Apache spokesman, wrote in an e- mailed response to questions. “We don’t publicly discuss what prospects we are considering or their locations.”

U.N. Protest

Peru plans to put up for bids 36 new oil and gas blocks after the government completes consultations with indigenous groups in the highlands and Amazon jungle, Ortigas said. The government aims to double investment in offshore oil operations to $4 billion by 2018, he said.

A United Nations committee requested the government suspend plans by Pluspetrol to expand its operations in the Camisea gas fields, fearing it will have a “devastating impact” on indigenous inhabitants of the Amazon rainforest, San Francisco- based environmental group Survival International said today in a statement.

The government may extend for another 10 years as many as seven expiring contracts with companies including Interoil Exploration and Production ASA and China National Petroleum Corp. in exchange for higher investment, minimum 20 percent royalties and taking on Petroperu as a partner, he said.

Crude oil for May delivery rose $1.10 to $94.81 a barrel on the New York Mercantile Exchange, the highest settlement since Feb. 19.

Copyright 2013 Bloomberg.
Alex Emery