TGP expects IDB, CAF loan disbursement in Q1

The TGP transport consortium in Peru's Camisea natural gas project expects to receive US$150mn in loans from the Andean Development Corporation (CAF) and the Inter-American Development Bank (IDB) in the first quarter 2004, newspaper Gestion quoted TGP CEO Alejandro Segret as saying. The CAF and IDB each approved US$75mn loans in September, but have not paid the money yet because TGP has been "meeting the conditions of the loans," Segret said. "There are certain conditions and when the conditions are fulfilled, the resources will be dispersed, but we can't really speculate as to when," IDB spokesperson Dan Drosdoff told BNamericas. "We would hope that the financing will be closed next year," he said, adding: "This is a very complex loan and the areas involved in the project are environmentally fragile, and it takes more investment, which means more time." The main conditions are related to environmental protection and monitoring, Drosdoff said. The upstream part of the project includes a controversial fractioning plant near the Paracas marine reserve. "The Peruvian government and the consortium have agreed to participate in environmental monitoring of Paracas Bay, which is an important step, and there's a Camisea fund that has to be up and running," he said. The government and TGP have also pledged to have sufficient staff to carry out monitoring and environmental commitments, he added. Meanwhile, TGP still plans to issue some US$225mn in 10-year bonds on local markets, but has delayed the issue until 2004 due to legal conditions and negotiations with banks, Segret said. TGP aims to raise about US$500mn in financing from the IDB and CAF loans, combined with the funds from the bond issue and a US$109mn loan from Brazil's national development bank BNDES. TGP has so far invested US$620mn, which is about 90% of the total US$750mn investment established in its concession contract. The consortium has completed 92% of the pipeline work, while the distribution and upstream sections of the project are respectively 83% and 85% complete, Segret said. Camisea tests are scheduled to start in June-July and operations in August, 2004. The TGP transport consortium is led by Argentina's Techint subsidiary Tecgas (30%). Other members are Argentina's Pluspetrol (23.4%), Algeria's Sonatrach (11%), Hunt Oil (24.6%) and Belgium's Tractebel (9%).