Bloomberg News

Petrobras Reviewing Peru Gas Project Amid Brazil Focus

September 05, 2012

Petroleo Brasileiro SA (PETR4), Latin America’s largest company by market value, is reviewing its investment in a joint natural-gas project with Repsol SA (REP) in Peru as it focuses spending on oil reserves in Brazil.

Petrobras, as the company is known, “is reviewing its investments in Block 57” to determine what will be done with the project’s output, the company’s press office said in an e- mailed response to questions yesterday. The Rio de Janeiro-based company is divesting assets to focus on developing its offshore oil reserves after reporting its first quarterly loss in 13 years in the second quarter.

Repsol, which operates the project, extended a deadline for Petrobras to make a payment for the project after it failed to do so on time last month, an official at one of the companies, who can’t be named because the information isn’t public, said in a telephone interview yesterday.

Block 57 is located in Peru’s Amazonian jungle, where Repsol and Petrobras are developing the Kinteroni gas field. The field was expected to begin producing gas in the fourth quarter, with gross production capacity of 5 million cubic meters, Madrid-based Repsol said in July.

Kristian Rix, a Repsol spokesman, declined to comment today.

To contact the reporter on this story: Rodrigo Orihuela in Rio de Janeiro at rorihuela@bloomberg.net

To contact the editor responsible for this story: James Attwood at jattwood3@bloomberg.net


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