Peru deploys army to safeguard strategic gas line
Peru's government has deployed army troops to safeguard a jungle stretch of the Camisea natural gas and gas liquids pipelines from potential attacks under a 60-day emergency declaration.
The lines are critical to Peru's LNG and LPG export businesses, which are operating normally.
The emergency measure covers an 80km stretch of the parallel lines running from the Camisea fractionating plant to Echarate province in the southeastern jungle.
The emergency decree, which puts the army in charge of security, extends for five kilometers on either side of the twin gas and gas liquids lines.
The decree states that the pipeline system is susceptible to terrorist attacks, but does not elaborate.
TGP, the pipeline operator controlled by Argentina's Tecgas, was unavailable for comment.
The twin pipelines pass through remote jungle areas that are home to remnants of a Maoist insurgency, Shining Path, which terrorized Peru in the 1980s and early 1990s. The group routinely targeted infrastructure. Its war on the state cost Peru more than 70,000 lives and $25bn in losses, according to a truth commission that reported on the violence in the previous decade.
Shining Path remnants targeted the gas line when it was under construction in mid-2003, staging a mass kidnapping of workers. Several more violent incidents near the line took place in subsequent years.
The 730km gas pipeline is critical to Peru's economy, providing gas for approximately 40pc of power generation in November, according to the energy ministry. It also supplies gas to Peru LNG, the only liquefaction plant along South America's Pacific coast. The ministry estimated that Peru would lose close to $500mn per day if the pipeline is knocked off line.
Peru produced 1.4bn cf/d of gas in November, with 1.1bn cf/d from Camisea's blocks 56 and 88, operated by Argentina's Pluspetrol, and 205mn cf/d from adjacent block 57, operated by Spain's Repsol.
Peru LNG, operated by US-based Hunt Oil, has dispatched 549 LNG cargoes since 2010, including three in December, two to China and one to South Korea.
By Lucien Chauvin
Related news posts
Shell's 1Q profit supported by LNG and refining
Shell's 1Q profit supported by LNG and refining
London, 2 May (Argus) — Shell delivered a better-than-expected profit for the first quarter of 2024, helped by a strong performance from its LNG and oil product businesses. The company reported profit of $7.4bn for January-March, up sharply from an impairment-hit $474mn in the previous three months but down from $8.7bn in the first quarter of 2023. Adjusted for inventory valuation effects and one-off items, Shell's profit came in at $7.7bn, 6pc ahead of the preceding three months and above analysts' estimates of $6.3bn-$6.5bn, although it was 20pc lower than the first quarter of 2023 when gas prices were higher. Shell's oil and gas production increased by 3pc on the quarter in January-March and was broadly flat compared with a year earlier at 2.91mn b/d of oil equivalent (boe/d). For the current quarter, Shell expects production in a range of 2.55mn-2.81mn boe/d, reflecting the effect of scheduled maintenance across its portfolio. The company's Integrated Gas segment delivered a profit of $2.76bn in the first quarter, up from $1.73bn in the previous three months and $2.41bn a year earlier. The segment benefited from increased LNG volumes — 7.58mn t compared to 7.06mn t in the previous quarter and 7.19mn t a year earlier — as well as favourable deferred tax movements and lower operating expenses. For the current quarter, Shell expects to produce 6.8mn-7.4mn t of LNG. In the downstream, the company's Chemicals and Products segment swung to a profit of $1.16bn during the quarter from an impairment-driven loss of $1.83bn in the previous three months, supported by a strong contribution from oil trading operations and higher refining margins driven by greater utilisation of its refineries and global supply disruptions. Shell's refinery throughput increased to 1.43mn b/d in the first quarter from 1.32mn b/d in fourth quarter of last year and 1.41mn b/d in January-March 2023. Shell has maintained its quarterly dividend at $0.344/share. It also said it has completed the $3.5bn programme of share repurchases that it announced at its previous set of results and plans to buy back another $3.5bn of its shares before the company's next quarterly results announcement. The company said it expects its capital spending for the year to be within a $22bn-$25bn range. By Jon Mainwaring Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
US Fed signals rates likely to stay high for longer
US Fed signals rates likely to stay high for longer
Houston, 1 May (Argus) — Federal Reserve policymakers signaled they are likely to hold rates higher for longer until they are confident inflation is slowing "sustainably" towards the 2pc target. The Federal Open Market Committee (FOMC) held the federal funds target rate unchanged at a 23-year high of 5.25-5.5pc, for the sixth consecutive meeting. This followed 11 rate increases from March 2022 through July 2023 that amounted to the most aggressive hiking campaign in four decades. "We don't think it would be appropriate to dial back our restrictive policy stance until we've gained greater confidence that inflation is moving down sustainably," Fed chair Jerome Powell told a press conference after the meeting. "It appears it'll take longer to reach the point of confidence that rate cuts will be in scope." In a statement the FOMC cited a lack of further progress towards the committee's 2pc inflation objective in recent months as part of the decision to hold the rate steady. Despite this, the FOMC said the risks to achieving its employment and inflation goals "have moved toward better balance over the past year," shifting prior language that said the goals "are moving into better balance." The decision to keep rates steady was widely expected. CME's FedWatch tool, which tracks fed funds futures trading, had assigned a 99pc probability to the Fed holding rates steady today while giving 58pc odds of rate declines beginning at the 7 November meeting. In March, Fed policymakers had signaled they believed three quarter points cuts were likely this year. Inflation has ticked up lately after falling from four-decade highs in mid-2022. The consumer price index inched back up to an annual 3.5pc in March after reaching a recent low of 3pc in June 2023. The employment cost index edged up in the first quarter to the highest in a year. At the same time, job growth, wages and demand have remained resilient. The Fed also said it would begin slowing the pace of reducing its balance sheet of Treasuries and other notes in June, partly to avoid stress in money markets. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
FERC OK’s Virginia Transco gasline expansion
FERC OK’s Virginia Transco gasline expansion
New York, 1 May (Argus) — The US Federal Energy Regulatory Commission (FERC) today gave Williams the green light to expand natural gas capacity to Virginia by 101mn cf/d (2.9mn m3/d) on its Transco pipeline. The project, called the Commonwealth Energy Connector, involves the construction of 6.3 miles of new pipeline within Transco's existing right-of-way in southeast Virginia, near the border with North Carolina. The project also includes adding horsepower at compressor station 168, west of the new pipeline segment. Williams plans to begin construction this winter and put the project into service by the end of 2025. Environmental advocacy group Sierra Club opposed the project, arguing FERC failed to assess its potential greenhouse gas emissions, rendering its National Environmental Policy Act analysis moot. FERC disagreed, conceding that although the project's final Environmental Impact Statement demonstrated it would contribute to greenhouse gas emissions, the effects of those emissions on the environment could not be measured because FERC lacks the methodology to do so. The US south-Atlantic gas market has become more volatile in recent years as gas and power demand have soared, outpacing pipeline capacity expansions in the region. The combined gas consumption of Virginia and North and South Carolina in 2022 averaged 4.7 Bcf/d, up by 69pc from a decade earlier, US Energy Information Administration data show. Regional gas and power consumption is widely expected to continue climbing through the end of the decade on a massive build-out of data centers , especially in Virginia. By Julian Hast Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Flogas opens Teesside LPG terminal
Flogas opens Teesside LPG terminal
London, 1 May (Argus) — UK distributor Flogas Britain has officially opened a new LPG terminal at Teesside in northeast England, which it says will boost the UK's security of supply by absorbing previously exported LPG. Flogas, a subsidiary of Dublin-based DCC Energy, developed the terminal alongside midstream companies North Sea Midstream (NSMP) and Exolum. The facility will use LPG produced at NSMP's Teesside gas processing plant (TGPP) and stored at Exolum's tanks. The terminal will supply around 90,000 t/yr to households and businesses in northern England, Scotland and Wales, Flogas says. Supplies from the facility started in February as part of its commissioning, with maximum capacity projected at 120,000 t/yr — volumes will depend on North Sea production and run rates at TGPP, the company says. The terminal — which is located near renewable DME firm Dimeta's Teesside plant project — can also be a gateway for renewable gases in the future, Flogas says. Around 1.2mn t of LPG was exported from Teesside in 2023, accounting for 40pc of the UK's total. Supplies in the northern UK could become more vulnerable after Petroineos announced the planned closure of its 150,000 b/d Grangemouth refinery in Scotland earlier this year, although a large proportion of its supply was exported. The UK consumed 2.4mn t of LPG in 2023, with demand forecast to rise to nearer 2.5mn t this year and in 2025, Argus Analytics data show. Domestic output stood at 3mn t, of which 1.4mn t came from refineries and 1.6mn t from gas processing. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more