April 23, 2013 / 3:36 PM / 4 years ago

Peru leader, Repsol chief meet amid talk of refinery investment

3 Min Read

LIMA, April 23 (Reuters) - Peru's president and the chairman of Repsol SA met late on Monday, presidential palace sources said, days after the government confirmed it was evaluating the purchase of a minority stake in the Spanish oil and gas company's Pampilla refinery and a chain of gas stations in Peru.

The sources declined to provide details of the meeting between Repsol Chairman Antonio Brufau and President Ollanta Humala. Humala did not answer questions about it on Tuesday at an event with reporters.

Last week, Prime Minister Juan Jimenez said Peru could buy a stake in one of the country's two main oil refineries from Repsol to help ensure adequate fuel supplies for consumers in the fast-growing economy.

Jimenez, who stressed that any investment would amount to a minority stake and not a controlling one, said he has sought to ensure Peruvian business groups that the government is not pushing a statist agenda at the expense of private companies that might also bid for the refinery.

Reuters reported on April 3 that state-run Petroperu had submitted a preliminary bid to buy Repsol's Pampilla refinery despite disagreements within Petroperu about whether it should agree to take on some $1.6 billion in liabilities for environmental improvements and other upgrades at the plant.

The plant has capacity of 102,000 barrels a day and is one of Peru's two main refineries. Pampilla produces about half of the refined products in Peru, a net crude importer.

Petroperu was told to look into the investment by the mines and energy ministry as part of Humala's efforts to guarantee domestic production, a source said at the time.

Humala ran for office on a platform that emphasized greater state control over "strategic" sectors such as natural gas and oil, although since taking office he has sought to lure more foreign investment to the sector in what has been South America's fastest-growing economy.

Repsol did not provide an immediate comment.

In February, Repsol sold liquefied natural gas assets to Royal Dutch/Shell for $4.4 billion in cash and the assumption of $2.3 billion in debt as part of a plan to protect its credit rating.

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