Energy
From The Report: Peru 2016
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By harnessing its hydro and gas resources, Peru has developed a robust and diversified energy mix. Cheap and plentiful power is one of the key comparative advantages for the country’s mining and industrial sectors. However, falling commodity prices coupled with anti-mining protests have led to the delay of major copper and gold projects in 2016. As a result, demand for energy has not reached previously forecast levels. Several major generation projects are set to come on-line in 2016 and 2017. As such, the country faces a period of oversupply estimated to last until at least 2021. In 2016 the push to facilitate the export of electricity should open up plans for major transmission projects and provide a new source of revenue for Peru. Meanwhile, at prices under $38 a barrel, appetite for oil exploration in the country’s remote regions has dwindled. This chapter contains an interview with Luis Ortigas, Former President, Perupetro.

Articles from this Chapter

Overview

Spark plug: New projects and policy reforms are set to transform the sector
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In 2008 Peru’s energy policy was confronted by a perfect storm. Five years of accelerating economic growth and the commissioning of major mining projects led to a surge in demand for petroleum products and electricity. The pipeline from the Camisea gas field to Lima, completed in 2004, was already operating at capacity, something it had not been expected to do until 2014. The price of oil was surging to $120 per barrel and, to make matters worse, a drought was affecting production at the nation’s…

Interview

Increasing capacity: OBG talks to Luis Ortigas, Former President, Perupetro
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Interview:Luis Ortigas To what extent can the country balance domestic production and demand, given the constraints of declining production? LUIS ORTIGAS: In 2014 oil production in Peru stood at 70,000 barrels per day (bpd), an increase from 60,000 bpd in 2013. If we also take into account growth in the output of liquefied natural gas, we can see that energy production is expanding. However, it is true that certain parts of the sector have reduced their output, mainly among private enterprises.…

Analysis

Breaking new ground: The industry is looking to explore a range of alternatives
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Although Peru is not subject to international treaties binding it to reduce carbon emissions, in May 2008 the government announced that the country would source up to 5% of its energy from non-conventional renewables, including wind, solar, biomass projects and small-scale hydroelectric projects of under 20 MW. Given that the country’s mega hydro facilities can endure periods of reduced production due to climatic events, the development of more diversified inputs is an important source of energy…

Analysis

To bid or not to bid: A new production contract at Peru’s most prolific oil block is up for grabs
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For over a decade, proposals to partly privatise state-run oil firm Petróleos del Perú (PetroPerú) and allow it to return to upstream activities have been debated in Peru’s Congress. Following the privatisation of the oil industry in the early 1990s, the company has been restricted to refining, transporting and commercialising petroleum products. However, at the turn of the decade, the success and seemingly strong prospects of national oil companies (NOC) in neighbouring countries, such as Petrobras…