March 14, 2014 / 5:55 PM / 4 years ago

Peru reaches deal with Spain's Tecnicas Reunidas to expand refinery

LIMA, March 14 (Reuters) - State-run energy firm Petroperu will sign a contract in April to start work on a $3.5 billion refinery expansion with Spanish oil engineering company Tecnicas Reunidas, the government said on Friday.

The project aims to increase output by 50 percent at the Talara refinery, Petroperu’s main plant, to around 96,000 barrels per day.

Prime Minister Rene Cornejo said during a presentation to Congress that the contract for the modernization of the refinery in northern Peru would be signed next month “now that technical studies and the contract framework have been established.”

Cornejo did not give additional details on the agreement or specify how much Tecnicas Reunidas might receive for its work.

Boosting capacity at Talara is central to President Ollanta Humala’s goal of transforming Petroperu into a bigger regional energy player, like Brazil’s Petrobras or Colombia’s Ecopetrol.

In December, Congress approved of the privatization of up to 49 percent of Petroperu, setting the stage for the first injection of private capital in more than four decades.

The government has said upgrades at Talara would begin this year and end in 2017.

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