Peru LNG stalls, imports authorized

Peru has authorized emergency LNG imports after a liquefaction plant shut down temporarily, opening the door for distributors to purchase independent supply.

The suspension of Peru LNG, the only LNG export facility in South America, was caused by a "technical problem", a Peru LNG executive told Argus.

Peru's energy ministry today published an executive order allowing gas distribution companies to import the liquid fuel for 60 days to guarantee domestic supply.

The alternative imports could come via cryogenic trucks from neighboring Chile. One of two Chilean import terminals is located in the northern city of Mejillones.

The ministry and Peru LNG, which is run by Dallas-based Hunt Oil, did not specify why the 4.4mn t/yr Pampa Melchorita liquefication plant was closed. The company told Argus that the problem had been identified and was under control. The plant had been closed from 27 March to 3 April for scheduled maintenance.

Feedstock for Peru LNG comes from Camisea gas blocks in the south-central jungle. Peru LNG is primarily an export project, but it also supplies domestic distributors along Peru's northern and southern coast since 2017.

The company provides LNG for distribution along the northern coast to Gases del Pacifico-Quavii, a subsidiary of Colombia's Promigas, and to state-owned PetroPeru, which distributes gas in four southern cities. PetroPeru took over gas distribution after Spain's Naturgy pulled out of Peru late last year.

In addition to authorizing the emergency imports, the decree states that the country needs to "establish mechanisms that allow for expansion of LNG supply options for the national market to ensure continuity of natural gas supply, guarantee consumer demand is met and contribute to mass use of natural gas."

Lima and the neighboring Ica region to the south have pipeline gas distribution systems that rely directly on Camisea gas. Distributors Calidda in Lima and Contugas in Ica are subsidiaries of Colombia's Grupo Energia de Bogota.

By Lucien Chauvin