Crisis in the hydrocarbon sector of Peru: gas reserves in alarming decline.

The situation of oil and gas in Peru is at a crossroads. Recent comments by María Julia Aybar, president of the hydrocarbons sector committee of the National Society of Mining, Petroleum, and Energy (SNMPE), highlight the crisis facing the country in this strategic sector. With oil production declining due to the halt of operations in the northern jungle due to social and environmental conflicts, the situation is turning critical, especially given the alarming decrease in natural gas reserves. The latest statistics indicate that gas reserves have fallen by half in the last eight years, decreasing from 16.1 to 8.4 trillion cubic feet. This decline means that the country only has enough stock for 16.7 years of consumption, leaving behind optimistic projections of 35 to 40 years. This trend is concerning, especially considering that no significant discoveries have been made in the sector since 2013, as noted by Carlos Bianchi, former exploration manager of Peru-Petro. The lack of investment in exploration is one of the factors that has led to this crisis. Investment in this area has plummeted from US$946 million in 2012 to just US$2.2 million in 2022. This reduction not only affects the production and reserves of hydrocarbons but has also led to a decline in student enrollment in petroleum engineering schools, reflecting a disenchantment with the industry's future. The effects of this crisis are particularly felt in communities that have historically depended on the oil industry for their livelihoods. In Loreto, many residents of river basins have had to migrate to the only active producing field in the northern jungle, Lot 95, operated by Petrotal. This migration has doubled the population in the district of Puinahua, generating tensions and social demands that the company has had to address with economic bonuses. In response to this issue, the government has begun to take measures to reactivate hydrocarbon activity. At a recent event, the Deputy Minister of Hydrocarbons, Iris Cárdenas, reaffirmed the need to start with the reactivation of the most critical lots, such as 67 and 39, which have been abandoned by the company Perenco due to conflicts with native communities and high production costs. However, the path to reactivation is not without obstacles. The possible creation of an indigenous reserve in these areas could further complicate the situation, limiting access for companies and hindering the resumption of production. According to Bianchi, Lots 67 and 39 present significant reserves, but social and political uncertainty poses a considerable challenge for their exploitation. Moreover, the exploration of natural gas in the southern jungle has become a priority. The Ministry of Energy and Mines (Minem) is seeking to reactivate conversations with Pluspetrol to explore new horizons in Camisea and in the Candamo deposit, which could hold large gas reserves. However, any progress in this direction could be affected by the resistance of local communities and strict environmental requirements. On the other hand, the development of offshore projects off the coasts of La Libertad and Ancash could offer a more viable and quicker alternative to increase gas reserves. Anadarko, which is conducting an ambitious seismic exploration campaign, could open a new chapter in the search for hydrocarbons in the country if the results are positive. This approach could encourage other companies to investigate the potential of Peru's offshore, thus diversifying the sources of production. The current situation of the hydrocarbon sector in Peru reflects the complex interaction between politics, the environment, and the economy. The urgent need to invest in exploration and production faces a landscape of social conflicts and environmental demands. If the country does not act quickly and effectively, it could share the fate of other countries in the region facing an uncertain future in terms of energy supply. Time is running out, and the need to ensure Peru's energy security is becoming increasingly urgent. Without a proactive approach to investment in exploration and the management of social conflicts, the outlook for oil and gas in Peru could become even bleaker. The industry is at a decisive moment, and the decisions made now will shape the country's energy future for years to come.