Peru's President Ollanta Humala told TV program Panorama March 25 that his government is "one step away" from reaching a deal with the consortium developing Block 88, one of the main blocks in the Camisea field—following through on a campaign promise that gas from that block would be reserved for domestic use. "This has been a renegotiation with the Camisea consortium, without using any force or without kicking over the table in any way," Humala said. He said that under the deal, the gas will be "recovered" for the people of Peru.

However, Manuel Dammert, Humala's ex-secretary of decentralization who was removed in last year's cabinet purge and now leads a group called the Sovereign Energy Forum, pressed for details on the plan. Speaking to Lima's left-leaning La Primera, he demanded immediate construction of a Southern Andean pipeline (Gasoducto del Sur) and a processing plant at Ilo, in southern Moquegua region, to meet internal demand in southern Peru, and supplement the existing Camisea pipeline that goes to a plant at Pampa Melchorita near Lima, where the gas is processed for export. He called construction of the second pipeline and plant necessary for the "modernity of this traditionally excluded region." (Dow Jones, March 26; La Republica, March 25; La Primera, March 19)

The fact that 2.5 trillion cubic feet of Block 88 gas are contractually tied to exports has held up the deal. The government is now demanding the Camisea consortium find other guarantees to meet those export contracts, freeing the Block 88 gas for domestic use. But even as Humala announced his breakthrough, Block 88 gas started to be exported from Pampa Melchorita. After months of delays, in late March an initial shipment of liquified natural gas (LNG) was dispatched from the complex to Mexico's new regasification terminal at Manzanillot, built and owned by a consortium of Samsung, Mitsui and Korea Gas under contract to Mexico's Federal Electricity Commission (CFE). (Dow Jones, March 26; Platts, March 9)

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