Peru Hopes to Create Petchem Industry
May 29, 2012
Peru's minister of energy and mines, Jorge Merino, speaking at the Latin American Leadership Forum in the capital Lima last week, said that Peru expected to attract USD53-billion-worth of investment in the energy and mining sectors over the coming decade.
According to a report from the state news agency Andina, the investment will be directed to 47 projects, 27 of which are already under exploration, 11 of which have environmental impact studies (EIA) already approved, eight of which concern expansions of existing mining projects, and one which is still waiting for the approval of its EIA. Merino also said that the state oil agency Perupetro plans to hold an international licensing round offering 22 blocks for oil and gas exploration in the second half of this year.
In addition Merino emphasised the importance of an integrated gas project that will see the transport of gas from the Camisea field complex to the south of the country to support the creation of a petrochemical industry. He predicted that the project will generate USD598 million in fiscal revenue as well as create 39,000 new jobs up to 2018, when it is due to be completed. Merino estimated that the project would increase GDP by around 1% of up to 2.5% under an optimistic scenario.
Significance: The mining sector continues to be the main recipient of foreign direct investment in Peru, and is likely to continue to attract strong interest although protests against some projects mean that perhaps not all of those under consideration will go ahead. Meanwhile the natural gas sector is set to undergo another phase of rapid expansion following the construction of the Sur Andino gas pipeline and several new petrochemical projects. The announcements underline incumbent president Ollanta Humala's aims to generate revenues for social inclusion policies from extractive industries.
Source: Global Insight
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