Pedro Chira: “The myth that production in Talara was going to decrease with Petroperú fell”

Two days after this interview, José Olivares and Brigitt Bencich resigned from the Petroperú board of directors. Their replacements will be the first to be chosen through a meritocratic process, as occurs in the most important oil companies in the world. A new stage that Pedro Chirahead of the state, awaits with high expectations.

-Petroperú increased the production of lots VI and Z-2B.

-The myth fell that the lots were going to be stopped. We received the Z-2B below 4,500 bpd and today production is again at 4,600 bpd. The VI was received at 1,950 bpd and, in the last two days, we took it to 2,010 bpd. There are no investments in exploration because they could not be paid in two years, but there is a search for efficiencies in infrastructure with workover work, that is, opening new areas that are incorporated into production.

-Do you now aspire to Lot X?

-That depends on Perupetro, although Petroperú has the capacity and, from an operational point of view, is demonstrating it. We have not had any further contact to discuss the matter with Minem and Perupetro, the report we have is the same one that has been published for prior consultations.

-Will they go to the tender?

-Petroperú is interested in the lot and, logically, would see a way to present itself. But it is something that will be defined once the type of contract is decided, whether it is for 2 or 30 years.

-When is the decree that formalizes the entry of Altamesa into Lot 162 published?

-It is being developed at Minem. This process should be completed in the next few days (it still needs to go through MEF) and then Altamesa enters the lot as operator. In our aspiration, we see that there are still working days and we hope to have the decree before the end of the year.

-What will the agreement be like?

-At the beginning, Altamesa will participate with 61%; Petroperú, with 39%. But there is an agreement from 2020: if the participation begins in two years, the barrel exceeds US$60, Petroperú would take 10% more up to 49%. We estimate that that is what will happen.

-Has it already been defined whether Petroperú or Perupetro will take charge of the abandoned assets?

-Since February, when the contract began, Petroperú has worked on the rehabilitation of all assets physical, and then the partner will complement it. With Perupetro it still needs to be defined. There has been discussion, but they have their own evaluation with a company that calculates the accumulated damage in two and a half years. It will be discussed eventually.

-The MEF denied their new request for contributions. What will they do?

-The market cannot stop supplying itself and we have done so in our worst circumstances, even losing money. Petroperú is working on the recovery of a series of credit lines for working capital and has an alternative program for 2024 in case the capitalizations are not achieved.

-But wasn’t it to prevent the financial blow of El Niño?

-The difference is that the refinery It is working and will give us positive flows that allow us to get out of this situation. In any case, MEF and Minem are part of the JGAthey know the situation and are attentive to any support they can give us.

-Will they reschedule debt?

-One of the things that was achieved in 2023 is financing with longer payment terms. Lines that we had lost began to open and some of them have allowed us to have longer deadlines. What had to be paid in 2023 will be done in 2024. But it is an issue that we will not be able to continue for long.

-How much progress has been made to strengthen governance?

-We have made progress in improving how to choose the Board of Directors. Now, it will be with a headhunter and the job profiles that are needed are already in place. The contest will be totally independent and The directors will no longer be elected by Minem and MEF, like it was before. We will go out to the market to look for the best professionals.

-What other changes?

-Another change is that two of the six directors will be women. Also how to incorporate mixed capital and its representation on the board of directors, which will be lower, since the largest will always be the State.

-And in restructuring?

-The CAP (how many people there should be based on operations), the ROF and the way in which personnel are incorporated and management is renewed were defined. Of the 52 managements at levels 2, 3 and 4, at least 30 will go to the competition.

-If you leave today, will your replacement go through a competition tomorrow?

-Yeah. The changes have already been made and we would have a two or three month process to find a new director.

-All in order to launch a public offering of shares.

-The initial objective is 20% of shares in two or three years [2025]if we meet the goals. Arthur D. Little It not only informed the volume we needed as support, but also recommendations that we followed even for the 2024 budget.

-Are the company’s accounts already recovering?

-In September, we were in blue; October, slightly negative due to a decrease in inventories due to falling prices; but November and December we expect US$2.5 million each month. In 2024, we project US$530 million of EBITDA with the refinery and US$80 million with the three lots. The year starts differently for Petroperú, since we have the refinery at 100% from day one.