Estimated cost of Peru coastal natural gas pipeline reaches US$2bn

Construction of a natural gas pipeline along Peru’s coast would cost around US$2bn, according to Tomás Delgado, CEO of Transportadora de Gas del Perú (TGP).

The executive provided the figure during a local energy event, adding that the duct would stretch 923km from Humay in Ica region to the south.

TGP, which transports Camisea gas and natural gas liquids to the coast from the Amazon, included the project in its concession extension request submitted to the energy and mines ministry (Minem).

He highlighted that the project would be a self-financed private investment with no state subsidies and would take around two years to build.

TGP is currently evaluating the proposal with Minem, the economy and finance ministry, energy and mining investment regulator Osinergmin and private investment agency ProInversión, said Delgado, who expects an agreement in the coming months, after which permitting would begin.

The development of a petrochemical hub would help anchor the project, along with supply to power reserve plants, mining operations and industrial, residential and vehicle offtake in the city of Arequipa.

Read MINEM establishes regulatory framework for the development of the Petrochemical Industry in Peru

“This pipeline would bring gas to the south at the same rate as Lima… no surcharge is being considered,” he said, who expects savings to reach 323bn soles (US$85.8bn) in 2034-43.

TGP’s project has been gathering traction amid the drawn-out process to develop the Sitgas duct system which would run south from Cusco, cost US$4.5bn and take six to eight years to complete.

Source: TGP