LIMA (Dow Jones)--Peruvian President Alan Garcia again defended the country's
natural gas reserves on Thursday, saying they stand at approximately 15
trillion cubic feet.
With exports of natural gas due to start next month, while companies and
regional governments queue for gas supplies, the issue of domestic reserves and
their distribution has become a volatile topic.
"Yes there is enough gas in Peru," Garcia told state newspaper El Peruano on
Thursday. "The blocks 56, 57, 58 and 88 show that we have approximately 15
trillion cubic feet." Of this, up to 8 tcf is already optioned for use, with 4
tcf to be exported over the next 18 years, he said.
Other studies have put Peru's natural gas reserves, in the southern Camisea
gas fields, at 8.8 tcf. In an effort to put an end to the ongoing disputes over
how much gas Peru has, the Mining and Energy ministry recently commissioned a
study of Peru's natural gas reserves, due to be published next week.
Garcia also told El Peruano the gas issue was one that needed to be considered
"with serenity, without electioneering or politicking". On Wednesday Garcia
ruled out declaring a state of emergency in the gas sector, which could have
diverted natural gas from export for domestic uses. "For now, there is no need
to declare any emergency," he said.
The contract for exporting the liquefied natural gas is held by the Peru LNG
consortium owned 50% by U.S.-based Hunt Oil, and 20% by Spain's Repsol YPF SA
(REP, REP.MC).
Investments in the Peru LNG project are expected to total $3.9 billion, and it
is one of the country's biggest private investment projects.
Earlier this week, the heads of five regional governments in southern Peru
demanded that no gas be exported until local supplies are secured. Garcia told
El Peruano that he guaranteed both the building of a gas pipe to supply
southern Peru, as well as the natural gas to feed the pipe.
Prime Minister Javier Velasquez told TV station Canal N, the building of the
Southern Andean Gas Pipe would start in January.