Sonatrach Gets Green Light to Buy Camisea Upstream Stake

Peru's state hydrocarbons investment corporation Perupetro has authorized Algerian state oil and gas company Sonatrach to buy a 10% stake in the Camisea natural gas upstream consortium from Argentine company Pluspetrol, a Perupetro source confirmed Tuesday.

Sonatrach has been negotiating with Pluspetrol to buy part of its share in the upstream consortium since 2002, the source said. Pluspetrol currently leads the upstream consortium with a 36% stake but was "never really interested in the operational aspect of the project, its main interest is coordinating the consortium and financing to make sure the project happens," the source said.

Other consortium members are US-based Hunt Oil (36%), SK Corporation (18%) and Argentina's Tecpetrol (10%).

Drilling on Camisea's block 88 is about 85% complete and is scheduled to be completed by December, ready to start production by August 2004, the source said. Total proven reserves on block 88 are about 8.1 trillion cubic feet. Details of how much Pluspetrol could sell for and when are not available yet, and Pluspetrol officials could not be reached for comment on Tuesday.

Sonatrach wants to increase its 10% interest in the TGP pipeline consortium through the purchase of part of Pluspetrol's 19% stake, but this transaction would need separate permission from the energy and mines ministry, the source said.

TGP will transport Camisea gas to the Pacific coast and capital city Lima. Peru's economy minister Jaime Quijandria believes Sonatrach's inclusion is positive because this will help plans to export Camisea liquefied natural gas (LNG) to the US, newspaper Expreso reported.

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