Page 9 - GLNG Week 17 2021

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Poll results raise concerns about fate

of Peru’s gas and mineral resources

POLICY CONCERNS about the future of Peru’s extrac- due to stand trial on corruption charges related
tive industries are mounting ahead of the to a former run for the presidency. But her poll
next round of the presidential election, as the slump has raised concerns about Castillo’s plans
top-polling candidate has talked about nation- for Peru’s economy and fears of state interference
alising the country’s natural gas and mineral in markets. These concerns are evident in reports
deposits. that investors are selling off Peruvian securities
Peru completed the first round of voting ear- and bonds, even as the country’s stock prices and
lier this month, and none of the contenders won exchange rates drop to new lows.
The Camisea gas fields a majority. As a result, the top two candidates – Investors’ worries are particularly sharp with
provide feedstock for Keiko Fujimori, the candidate of the conserva- respect to crude oil, natural gas and copper
the Peru LNG plant. tive Fuerza Popular and the daughter of former resources. The Peru Libre party has been calling
President Alberto Fujimori, and Pedro Castillo, for nationalisation of the hydrocarbon and min-
the candidate of the leftist Peru Libre party – are ing sectors since 2019. It did so long before the
proceeding to a run-off election, which is sched- latest presidential election, but Castillo himself
uled to take place on June 6. has indicated that he favours this approach.
Currently, the leftist candidate is ahead in the Earlier this month, for example, he told his
polls – and his opponent has been losing ground. supporters that the Camisea gas fields ought to
As of April 27, a survey conducted by Instituto be handed over to the state. He described the
de Estudios Peruanos showed that 41.5% of fields, which provide feedstock for the Peru
Peruvians favoured Castillo, while only 21.5% LNG plant, as a strategic resource that should
expressed a preference for Fujimori. This rep- be nationalised so that it could benefit Peruvi-
resented a shift from poll results published last ans rather than foreign investors. The Camisea
week, which estimated the market-leaning con- fields are being developed by a consortium that
servative’s support at around 30%. includes US-based Hunt Oil, which is also the
Fujimori is a controversial candidate, as she is leader of the Peru LNG project.™

Pembina pauses Jordan Cove development

PROJECTS & CANADA’S Pembina has put the development waive Oregon’s water quality review for Jor-
COMPANIES of its proposed Jordan Cove LNG export project dan Cove, and in February the US Depart-
in Oregon, on the US’ West Coast, and an asso- ment of Commerce sustained Oregon’s
ciated natural gas pipeline on pause. objection under the Coastal Zone Manage-
In an appeals court filing last week, the com- ment Act.
pany said it was assessing “the impact of recent Pembina had been seeking to emphasise Jor-
regulatory decisions involving denial of permits dan Cove’s advantageous location on the Pacific
or authorisations necessary for the project to Coast. It is closer to growing Asian markets and
move forward”. would have allowed cargoes to be shipped to
The Jordan Cove project received approval to Asia directly without having to transit the Pan-
proceed with construction from the US Federal ama Canal the way LNG shipments from the US
Energy Regulatory Commission (FERC) last Gulf Coast do.
year, but has failed to acquire necessary water Indeed, congestion in the Panama Canal
permits from Oregon. over the winter led to severe delays for cargoes
Pembina’s filing came in a case where various passing through the waterway. While this may
opponents are challenging the FERC authori- have bolstered the case for shipping LNG along
sation for the project. The decision comes as no other routes, including elsewhere on the Pacific
great surprise, given that the company already Coast, this was not enough to overcome strong
said in February that it could no longer predict state-level and local opposition to Jordan Cove in
when Jordan Cove might be built, and was evalu- Oregon.
ating a path forward, having previously targeted Jordan Cove was designed to produce around
a start-up date of 2025. 7.5mn tonnes per year (tpy) of LNG. While Pem-
That move came in response to recent bina’s announcement does not amount to an
legal setbacks for the project. In January, outright cancellation, this outcome now seems
the FERC denied a request from Pembina to increasingly likely.™

Week 17 30•April•2021 www. NEWSBASE .com P9