Background on Petroperú and its Significance
Petroperú, a Peruvian state-owned oil company, is one of the two major petroleum firms in Peru. It operates or has concessions for six crude oil lots with limited production, and manages a distribution and commercialization chain of petroleum products. The company’s refinery in Talara has been modernized with an investment of approximately $6.5 billion, making it a crucial asset for the nation’s energy sector.
Government’s Restructuring Plan
Facing a complex financial situation reflected in accumulated losses of $479 million between January and October 2025, along with outstanding debts of $764 million to suppliers, the Peruvian government approved a restructuring plan for Petroperú. This plan aims to ensure the continuity of its operations and attract private investment.
Through a “decree of urgency” issued on Wednesday evening, the government allowed Petroperú to separate into one or more “property blocks,” including the modernized Talara refinery. This move aims to enable private capital entry into key Petroperú assets.
Additionally, the decree grants promoter investment company PROINVERSIÓN the authority to establish trusts and guarantees for securing Petroperú’s “critical liabilities” using funds generated by the property blocks or strategic assets.
Financial Support and Workforce Reduction
The government also authorized a capital contribution equivalent to $71 million for Petroperú in 2026, intended to finance workforce reduction within the company. This decision comes as Petroperú reported losses of $774 million in the previous year, facing pressure from creditors and suppliers due to debts related to Talara refinery modernization, which exceeded initial estimates.
Key Questions and Answers
- What is the main reason for Petroperú’s restructuring? The restructuring aims to address Petroperú’s complex financial situation, characterized by accumulated losses of $479 million and outstanding debts of $764 million to suppliers.
- What does the restructuring plan entail? The plan allows Petroperú to separate into property blocks, including the modernized Talara refinery, to attract private investment. It also enables PROINVERSIÓN to establish trusts and guarantees for Petroperú’s critical liabilities using funds from these property blocks or strategic assets.
- What is the purpose of the authorized capital contribution? The $71 million capital contribution in 2026 aims to finance workforce reduction within Petroperú, addressing the company’s financial pressures from creditors and suppliers.
Impact of Petroperú’s Financial Crisis
Petroperú lost its investment-grade rating from credit agencies in 2022 due to its financial crisis, with debts owed to bondholders and private banks for the Talara modernization project, which cost twice the initial estimate. The Peruvian government has provided financial support measures to Petroperú totaling $5,317 million between 2022 and 2024.
