Hunt Delays Call for Bids on US$1.1bn LNG Plant

Dallas-based Hunt Oil has delayed plans to call for bids on the construction of a US$1.1bn plant to liquefy natural gas from Peru's Camisea fields for export to North America, Hunt Oil Peru general manager Carlos del Solar told BNamericas. "Things are not moving as quickly as we would like," del Solar said, adding that it is now "unlikely" that Hunt will call for bids by the end of April, as planned.

The main reason for the delay is that Hunt must first find offtakers, but is still talking to two companies which could sign contracts to buy the LNG and process it in Mexico for sale to the Mexican and US markets. A number of companies are planning LNG regasification plants on Mexico's west coast, but del Solar would not say who Hunt is negotiating with.

Construction of Hunt's LNG plant, 169km south of Lima at Pampa Melchorita, would take 42 months, with operations starting by the end of 2006. US-based Foster-Wheeler, Kellogg Brown & Root and France's Technip have all expressed previous interest in the construction contract. Kellogg Brown & Root, a division of the US-based company Halliburton, completed a front-end engineering design (FEED) study in November. A Canadian company is doing the EIS, while Hunt is doing its own market study. Hunt had planned to complete its environmental impact study (EIS) by late March, but will now present the EIS to Peruvian authorities by April 30, del Solar said.

Parallel to the investment in the liquefaction plant, the members of the upstream Camisea consortium will sink an additional US$800mn into drilling wells, expanding pipelines and other infrastructure. The SK Corporation is the only member of the upstream consortium that has agreed to join Hunt in the LNG export consortium, and Hunt is still looking for at least one more participant, del Solar said.

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