Peru Says Will Cut Royalties In Current Oil Contracts By July

Perupetro announced in November that it would slash royalties from the current 20 percent to about 5 percent on average in future contracts awarded.

However, Zoeger said that plans to auction off the rights to six offshore oil blocks and 26 Amazonian concessions have been pushed back again at the request of interested companies.

Perupetro had previously planned on open bidding on those blocks starting in the first quarter.

The bidding round will likely not start until at least late July, after a new president takes office, Zoeger said.

Peru is a net oil importer, and its production dropped to 58,000 barrels per day in 2015, almost half of peak production in the 1970s.

Zoeger added that Perupetro was also proposing to reduce the $10-per-barrel fee that state-owned energy company Petroperu charges private companies for moving crude through its pipeline in northwestern Peru.

Petroperu is the state-owned energy company and Perupetro is the state agency tasked with negotiating oil contracts.


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