Petroperu Closes 30-Year Contract on Block 192

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Researched by Amir Richani for Industrial Info Resources (Sugar Land, Texas)--State-owned Peruvian energy company Petroperu (Lima, Peru) signed a contract earlier this week to operate Block 192 in Peru's Loreto province, three years after its shutdown. Block 192 is believed to be the country's largest oil deposit.

Petroperu announced on Tuesday it had reached an agreement with local authorities to operate and exploit Block 192 for 30 years. The block has been offline since February 2020, a few months before Frontera Energy's (Calgary, Alberta) exit from the asset.

Block 192 is estimated to hold 127 million barrels of light, medium and heavy grades. Before shutting down, it was producing 7,000 to 10,000 barrels of oil per day (BBL/d), with some monthly fluctuations, according to Peru's Energy Ministry. With the resumption of operations, Peru expects oil production to increase about 25% from the 35,000 to 45,000 BBL/d produced over the last 12 months.

Industrial Info is tracking more than US$49 million worth of active projects as part of the Block 192 development. Subscribers to Industrial Info's Global Market Intelligence (GMI) Oil & Gas Project Database can click here for a list of detailed reports for projects related to the development.

Petroperu, which will hold the concession until 2053, is looking for a partner to develop the asset. If successful, it will be the first time a state-owned company will be in charge of operations at Block 192.

Carlos Vives Suarez, Petroperu's director, said that "the relaunch of the oil industry in the Northern Jungle, with the reactivation of Block 192, will strengthen a virtuous cycle for our energy security and the growth of the hydrocarbon industry, for the benefit of communities and all Peruvians."

Production at Block 192 will not begin immediately. According to Petroperu, it will take about a year to rekindle the asset's oil flows, since the company must evaluate closed oil wells in the area. Oil produced at Block 192 will go to the revamped, 95,000-BBL/d Talara Refinery, also operated by Petroperu.

Over the years, the development of Block 192 has been affected by protests. Frontera had to halt operations several times, due to local opposition stemming from oil spills in the region.

It remains to be seen if Petroperu will be able to navigate these waters and keep operations stable. As part of the new agreement, Petroperu is establishing a fund for the development for local communities.

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