MercoPress. South Atlantic News Agency

First shipment of Peruvian liquefied natural gas heads for Mexico

The Spanish company Repsol has an 18 year exclusive contract to market the entire output of the Pampa Melchorita plant

Peruvian natural gas was exported for the first time this week from the recently inaugurated Pampa Melchorita plant, to the south of Lima. The LNG was delivered by Spain’s Repsol onto the Barcelona Knutsen Tanker and dispatched to Mexico.

This shipment marks the start of Repsol’s exclusive-rights contract to market the entire output of the plant, in accordance with the agreement signed with Peru LNG in 2005 for a term of 18 years from the start of commercial operations. In terms of volume, this will be the biggest LNG acquisition ever made by Repsol.

Additionally, Repsol has an LNG supply contract with the Federal Commission of Electricity (CFE), Mexico for the natural gas terminal at Puerto de Manzanillo, on the Mexican Pacific coast. This contract envisages the supply of LNG to the Mexican plant for a period of 15 years and with a volume of at least 67 bcm, which is due to be operative during the fourth quarter of 2011. The Manzanillo plant, which will supply power plants of the Federal Commission of Electricity (CFE) in West Central Mexico, will source the gas from the Peru LNG plant.

The Barcelona Knutsen Carrier, with a capacity of 173,400m3, is heading for the Costa Azul energy terminal in Ensenada (Baja California), Mexico with its first LNG delivery. The Carrier, which was delivered last April to Repsol, is the first of six vessels assigned to the Peru LNG project (four of which are long term, two short/medium terms).

The plant, with a nominal capacity of 4.4 million tons per year, will process 17 million cubic feet of gas per day, equivalent to 15% of the annual gas consumption in Spain. It has the two largest storage tanks in Peru (each holding 130,000 m3 of LNG) and a marine terminal that stretches more than a kilometre in length, able to receive carriers with a capacity of between 90,000 m3 and 173,000 m3.

The natural gas supply comes from the Camisea gas field, in which Repsol also has a 10% stake, and is fed through a 408-kilometre gas pipeline built as part of the Peru LNG project.

For more than 50 years Repsol has explored for and produced oil and gas, and has distributed and marketed oil products in Peru, where it is one of the biggest companies in terms of turnover and one of the largest domestic taxpayers.

Repsol began its exploratory activities in 1995 and today holds stakes in eight blocks, operating four, two in the Marañón river basin and two in the Ucayali River. In August 1996 Repsol bought the Pampilla Refinery, the most important facility of its kind in Peru, and has made constant modernisation investment.

In terms of marketing products, Repsol is one of the industry’s main operators, with more than 230 service stations distributed throughout Peru. It also manages direct sales, industrial sales of fuel for aviation and is the leading company in the Peruvian LPG (liquefied petroleum gas) market.