Exclusive: Peru says natgas negotiations suspended

Reuters News
Posted: Dec 15, 2011 12:48 PM
Exclusive: Peru says natgas negotiations suspended

By Omar Mariluz

LIMA (Reuters) - Peru and the consortium operating the giant Camisea natural gas fields have suspended negotiations over gas supplies and royalties, and talks should resume in three or four months, the head of Peru's oil agency said on Thursday.

The consortium, led by Argentina's Pluspetrol, asked for the suspension, seeking time to broker an agreement with its international financial backers over one of the largest parcels, known as lot 88, Aurelio Ochoa, head of state-run Perupetro, told Reuters.

President Ollanta Humala campaigned on promises to ensure that gas in lot 88 is reserved for the internal market and not exported.

"We've accepted a delay until early next year, they have to negotiate with the banks," Ochoa said.

Peru also seeks to correct market distortions through negotiations so that royalties paid on exported fuel are always higher than those paid on fuel used domestically.

Talks with the consortium started during former President Alan Garcia's government

Spain's Repsol-YPF, U.S.-based Hunt Oil, South Korea's SK Energy, Algeria's Sonatrach and Argentina's Tecpetrol are also part of the Camisea consortium.

(Reporting By Omar Mariluz. Writing by Caroline Stauffer; Editing by David Gregorio)