Petroperú

On October 9, 1968, the government of Juan Velasco Alvarado ordered the seizure and expropriation of the facilities of The International Petroleum Company (IPC), a subsidiary of Standard Oil of New Jersey, in the Talara refinery; the same that was carried out by the forces of the First Military Region based in Piura, under the command of General Fermín Málaga. This fact has a great impact on the country and helps the government to consolidate itself in power. The date of October 9 is celebrated throughout the military government as the Day of National Dignity.[5][6]

Subsequently, Petroperú was created by law on July 24, 1969 by the same government of the then President of the Republic, General Juan Velasco Alvarado. As soon as the new oil company was created, whose first board of directors was chaired by General Marco Fernández-Baca Carrasco, it must face a new challenge that defines its profile: to operate and maintain almost the entire complex oil industry of the country with its own personnel and without the technical support from the international oil community, which refuses to collaborate because a process of nationalization by the Revolutionary Government had been launched in the country.[7][8]

The result confirms the capacity of Peruvian workers, technicians and professionals who manage to supply permanently - and in a sustained way - the national demand for fuels. Oil self-sufficiency is progressively achieved, thanks to the historic discoveries of the fields in the northern jungle and the construction of the North Peruvian Pipeline.[9][10][11][12][13][14][15][16][17][18]

During 2011, Petroperu participated in the construction of the Southern Pipeline, a project that aimed at improving the economic conditions in the south of the country. It also invested about 400 million dollars in the construction of the ethane pipeline that started in the city of Pisco, the same year.

In December 2020, the state oil company, at the special request of the Executive Branch, headed by President Francisco Sagasti, assumed the concession of the Natural Gas Distribution System by Pipeline Network of the South West Concession, for up to three years. This way, Petroperu takes over the administration of this temporary concession in order to guarantee the continuity of the provision of the public service of natural gas distribution through the pipeline network in the Arequipa, Moquegua and Tacna regions.

This assignment is assumed with full responsibility in a key period for the state company, which is in a modernization process that includes the implementation of important activities that allow it to evolve, maintaining the leadership and sustainability of the business, with transparency, and social and environmental responsibility.[19]

In January 2021 it officially unveiled its new identity, the result of more than eight years of work in a transformation process that has resulted in a renewed and much cleaner version of the institution's image. With this change, Petroperu seeks to position itself in the Peruvian fuel market with a sustainable and competitive projection.[20]

Also in 2021, it received authorization from the Executive Power to issue bonds worth up to $ 1 billion to finance the last phase of the modernization works of the Talara Refinery.[21]

Petroperu has a strategic importance in the provision of energy throughout the country. Its approximate refining capacity is 94,500 barrels per day (B/D), which represents 46% of Peru's total refining capacity. It is the owner of the Talara Refinery, the Conchán Refinery, the Iquitos Refinery, the El Milagro Refinery and the Pucallpa Refinery, five of the six refineries that exist throughout the national territory.[22] It is known that it only operates four of these five refineries since the Pucallpa refinery is leased to Maple Gas[23] and, on the other hand, the El Milagro Refinery has still been out of service since January 2015.

The company has the necessary coverage to meet the national demand because it has a presence throughout the country. It has the capacity to meet the requirements of foreign companies and is a strategic supplier to the Armed Forces and National Police of Peru.[24]

The fuels and derived products produced by Petroperu are:

In addition to fuels, Petroperu also offers solvents, naphthenic acid and asphalts in its list of products.[25]

The Talara Refinery Modernization Project is an engineering and construction megaproject that consists of the installation of new process units and facilities aimed at improving product quality, increasing the refinery's production capacity, and implementing more complex processes. and more advanced technology. The economic and environmental benefits are as follows:

• Desulfurize fuels.
• Improve the octane number of gasoline.
• Process heavier crude oils.
• Reduce the production of residuals.
• Implement new facilities that the modernized refinery will require.
• Produce cleaner fuels.[26][27][28][29][30][31][32][33][34][35][36]

On December 17, 2013, then-President Ollanta Humala promulgated Law 30130, which declared the modernization of the Talara Refinery[37] to be of public necessity and national interest to ensure the preservation of air quality and public health. The law also indicates that measures be adopted to strengthen the Corporate Governance of Petroperu.[38][39][40][41]

The objective of the Project is to extract the crude oil reserves discovered in the Situche Central field, in Lot 64, located in the Loreto region.

The Project design foresees a modular execution scheme that facilitates the putting into production of the discovery wells (early production) and that allows the development of the deposit, in accordance with the confirmation of its productive potential:

• Phase A: Putting Well SC-3X into production
• Phase B: Putting Well SC-2X into production
• Phase C: Comprehensive development of the Situche Central Field

Additionally, the project includes the drilling of an exploratory well to increase the hydrocarbon reserves in the lot.

The project was planned to be developed in accordance with the terms and conditions of the Joint Investment contract signed by Petroperu S.A. and Geopark Peru S.A.C. which included an initial participation of 25% and 75% respectively. However, in July 2020, Geopark Peru S.A.C. decided to abandon Lot 64.[42] Petroperu accepted the assignment of 75% of the additional participation, thus obtaining 100% of the rights and obligations as a contractor.[43][44][45][46][47][48][49][50][51][52][53]

Most of the oil to be transported through the North Peruvian Pipeline is classified as heavy crude (density below 20° API), so it is necessary to adapt this transportation system in order to transport said crude. The project has been called the Heavy Crude Transportation Project (PTCP).

The heavy crude from the lots located in the northern jungle of Peru will be transported by the North Branch of the ONP, from Andoas to Station 5 and from there to Bayóvar through Section II. Section I of the ONP (Station 1 - Station 5) will be used when the Perenco company transports its early production of 7 MBPD (July 2013) by river and delivers it to the ONP at Station 1 (San José de Saramuro), for its transfer to Bayovar.

The mission of this project is to provide Petroperú with an integrated, flexible and secure information system, based on the best practices of the hydrocarbon industry, which provides the organization with modern tools that allow it to plan its business resources, improve its competitiveness and meet the needs of its new markets and businesses. The areas in which ERP is being implemented are the following:

• Finance
• Commercial
• Logistics
• Maintenance
• Refinement
• Human Resources

The company has a feasibility study prepared by the Spanish company Fluor, for a future modernization of the Iquitos Refinery. It has also formed a Task-Force team to formulate a medium-term project for the modernization of the Conchán Refinery, another of its refineries located south of Lima. It will also explore lot 192, in which it is looking for partners.[54][55][56][57][58][59][60][61][62]