GNL Mejillones in talks to supply LNG to Peru

Chile's Mejillones LNG terminal is in "very preliminary talks" with Peruvian gas distributors for emergency supply during an unplanned outage at the Peru LNG liquefaction complex, industry sources tell Argus.

The contacts were described as "informal" to confirm the feasibility of cryogenic trucks loading in Mejillones for the journey north into southern Peru. The trucks, which would be deployed by the Peruvian companies, would need to travel some 1,200km (745.6mi) compared with their normal 600km range.

The Peruvian distribution companies rely on Peru LNG's 4.4mn t/yr liquefaction complex at Pampa Melchorita, which the liquefaction company does not expect will return to service until the end of May because of a "technical fault with one of its compressors" that occurred about a week ago. The liquefaction terminal last exported a cargo on 27 April, data from oil analytics firm Vortexa show.

In a hint of the potential alternative supply line, Peru's energy ministry on 13 May issued an executive order allowing gas distribution companies to import LNG for 60 days to guarantee domestic supply.

Peru LNG, controlled by Dallas-based Hunt Oil, is supplied from the 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 distributors that rely on Peru LNG include Gases del Pacifico-Quavii, a subsidiary of Colombia's Promigas, and state-owned PetroPeru, which distributes gas in four southern cities. PetroPeru took over the distribution after Spain's Naturgy pulled out of Peru late last year.

The 1.5mn t/yr GNL Mejillones terminal, located on Chile's northern Pacific coast, is controlled by France's Engie.

Mejillones received a cargo from the 154,500m³ LNG Alliance on 15 May, while the 174,000m³ Pan Asia is sailing north up the coast of Chile but has yet to declare a final destination, vessel tracking data show.

Chile's main LNG receiving terminal is GNL Quintero on the central coast.

By Patricia Garip