Ministry Approves E&P Contracts; Perupetro to Tender 18 Blocks

Peru's energy and mines ministry has approved the signing of three new contracts for blocks 116, 125 and 128 in the Peruvian jungle, local press reported.

A contract for block 116 will be signed with the Peruvian subsidiary of French oil company Hocol, block 125 will be signed with US firm Barrett Resources' local subsidiary and block 128 will be signed with the local subsidiary of Canadian oil company Gran Tierra (Nasdaq: GTRE).

The blocks will require combined US$50mn investment over the next five years.

The contracts will bring the number of contracts signed this year up to 16, one more than was signed in 2005.

Increasing interest in Peruvian E&P has led Peru's state hydrocarbons promotions agency Perupetro to change its policy for awarding E&P contracts.

Currently, companies interested in Peruvian blocks present their request to Perupetro and begin contract negotiations. This year, however, several companies were interested in each block, so Perupetro has decided to tender upcoming blocks.

Perupetro will tender 18 blocks in the first half of 2007, Perupetro president Daniel Saba said.

Perupetro will carry out a road show in Houston in January to promote the 18 areas.

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