Juan Manuel Rojas: “The cool thing about Peru is that everything remains to be done and you have gas”

Special envoy to Talara.

The overcrowding of natural gas progress in the regions. This is the case of the northern concession and Piura. This week, Promigas reached 175,000 connections in this area of ​​Peru, a country that still has a penetration level of just 11%. In Colombia, 70% of the population already has energy at home. The challenge is huge.

What do you consider the correct massification scheme?

The circumstances of each country must be taken into account. When one looks at the number of users in northern Peru versus those concentrated in Lima, what one wonders is whether or not the construction of a gas pipeline from Lima to northern Peru is justified and, by size of users , in the end, you would be charging too high a surcharge to users to build a 1,000-kilometre gas pipeline. The alternative here (north concession) is undoubtedly to do it through trucks as is being done today because it is cheaper and the impact on the end user is not as high.

Is Peru going in the right direction of overcrowding?

What Peru has done very well is associated with progress in the levelized tariff and that is something that has to be done. The socioeconomic differences that exist between more developed centers: Lima versus what we have in this area of ​​the country (Piura) or in other areas, without a level tariff it is difficult for this penetration to be done more quickly. Afterwards, the Fise is a very effective tool, where through this type of funds and project structuring, the effective way to reach vulnerable populations is found.

How much have they been investing in Peru?

We have invested US$350 million and we have another US$150 million to invest in this northern zone. We have 175 thousand people connected. We have completed connection 4,000 (in Piura) and connection 175,000 (in the entire north) in a very short period of time. We want to continue investing, it is our commitment and we need stable rules for that.

Are you worried about the political tension or the absence of key authorities in the Peruvian energy sector?

Uncertainty is always an issue that investors have to deal with, the problem is when it goes on for so long. When one makes the decision to enter a country, one does not enter with the vision of 4 or 5 years, one enters with a vision of being 30 or 40 years old and one knows that in those periods there can be governments of different political colors, which The important thing is that the rules of the game are maintained. When you’re in a regulated business, the most important thing is to be able to discuss things with the government because it’s your ally. If the government is doing well, you are doing well and the country is doing well. If the conditions change halfway, then the investment is already affected there. We like Peru because we see that it has historically respected the rules of the game and that is a very important condition to continue investing.

What does Piura represent within its operations to the extent that it is a natural gas producing region?

In this northern region there was the illusion of gas for 20 years and it never arrived. There was a company in charge for 10 years that did not comply, that did not manage to massify. We have been in the Gases del Norte del Perú and Gases del Pacífico concession for two years and a year and a half, respectively, and we have 175,000 people connected. For the population of Piura, the benefit is that it has the lowest gas rate in the entire country because the local resources are being developed and are being used by the local population.

What challenges do you see in overcrowding in Peru?

The cool thing… the interesting thing (he corrects himself with laughter) about Peru is that everything remains to be done and you have gas but only 11% of the population have penetrated. Colombia has 70 to 75% of the population already overcrowded. Replicating that by already having the resource here is spectacular, that is, the possibility is enormous.

Being Colombia a country that has successfully developed its energy policy, what would you say is the recipe?

We have an industry where there is room for everyone. There is room for the state company Ecopetrol, which has 88.5% in public hands and 11.5% in private hands. There is room for private companies like Promigas, for oil operators and other gas operators. So it is a business where there is room for everyone and with clear rules of the game, clear regulations. Today, the user, the residential customers, the industrial customers, the commercial customers, the street user sees the impact of these clear rules. Today 70% of the population of Colombia, about 10 million users, are connected to the massification of gas and that is because there are almost forty million Colombians benefiting from it.

I understand that they visited the Talara refinery. How do you see this megaproject?

What I can say is that Peruvians should feel proud of the expansion of the refinery that they are doing, because in the end it will benefit all Peruvians. The mere fact of being able to reduce sulfur from 2,500 particles per million to 50 or less is an enormous benefit for the quality of the air in Peruvians. It updates and updates Peru in fuel quality with respect to standards that exist in other countries of the world such as Europe, or in Colombian cities such as Medellín or Bogotá. These projects have a cost, it is true, but also the industrial development for Peru of having these projects is very important. To what is associated at the end of the day, the spillover effect of these projects on the economy is tremendous and sometimes one does not even finish quantifying them. One can make the decision to say let’s import or we do it ourselves. It seems spectacular to me that you can do it as an industrial development for this region of the country.