US$2.4bn capex envisioned for Peru’s top oil block

Estimated capital expenditure for Peru’s principal crude producer, block 95, in 2026-35 reaches US$2.4bn, according to the acreage’s operator PetroTal.

In a presentation, the company highlights that around US$1bn would go to drill 49 new wells and US$1.3bn to associated facilities.

The proposed facilities include loading infrastructure/tanks for US$300mn, power generation US$250mn, water disposal US$200mn, dry hole/technical learning US$160mn, camps/clearing/construction (four camps) US$150mn, platforms US$100mn, abandonment/environmental issues US$100mn and seismic US$30mn (2025 spend).

Block 95 capex for 2023 totals US$130mn with US$69mn to bring three new wells on production and one additional water disposal well, US$36mn for additional production and water handling equipment, US$13mn for the L2 West platform and US$12mn for erosion mitigation.

Block 95 is in the northern Amazon region of Loreto and produced 11,405b/d in July.

This year’s production guidance for the block is 14,000-15,000b/d, according to PetroTal’s second quarter earnings release.

BLOCK 107

In Peru, PetroTal also holds exploration block 107, which straddles the central regions of Huánuco and Pasco, and where two drillable prospects have been identified on 2D seismic: Osheki-Kametza and Constitución Sur.

PetroTal said that the commitment to drill two exploration wells was extended to 2024-25 and that it will seek a farmout partner for the wells or for longer term development. Gran Tierra Energy has a 20% back-in interest in the block.

Investment to drill Osheki-Kametza and Constitución Sur is estimated at US$28mn and US$22mn.