Petroperu Issues Debt Bonds To Finance a Refinery Project

Peru's Economy Ministry (MEF) authorized the state-owned oil company Petroperu to issue debt bonds to finance Talara Refinery's Modernization Project (PMRT). These bonds, however, will not be backed by the government.  

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MEF's decision responds to warnings from Petroperu President Eduardo Guevara who assured that US$700 million were needed to complete the Talara project. 

Non-financial public enterprises will now be able to enter into debt operations not exceeding USS1 billion. Previously, Petroperu held talks with the Spanish government to close a deal of US$285 million destined to the PMRT.

"Talara refinery will reduce the sulfur content in fuels to comply with environmental standards... It will start with the Euro 4 anti-pollution regulations but we have to be prepared to jump to Euro 6 regulations," Guevara said.

Set to conclude in November this year, the PMRT required an estimated investment of US$4.7 billion to increase the refinery's processing capacity from 65,000 to 95,000 barrels per day (BPD).

After being suspended for three months due to the pandemic,  the Talara modernization works were restarted gradually on June 15, 2020. 

Noting that the project has advanced 91 percent, Guevara highlighted that Law no. 30130 declared PMRT as a "public need" and "national interest" to ensure the preservation of air quality and public health.