BANKS DODGY DEALS CAMPAIGNS
About BankTrack
Visit us
Organisation
Our team
Our board
Guiding principles
Team up with us
Jobs at BankTrack
Our annual reports
Funding and finances
History
BankTrack in the media
Our privacy policy
Donate
2023-03-17 00:00:00
Briefing: The role of financial institutions in decarbonising the steel sector
2023-03-09 00:00:00
Dutch bank ING supports controversial pipeline to import gas from authoritarian Azerbaijan
2023-02-23 00:00:00
Financial institutions need to address steelmaking’s coal addiction
2023-02-07 00:00:00
What COP15 means for banks: meeting the Global Biodiversity Framework requires protecting Indigenous rights and divesting from harmful industries
2023-03-20 08:50:41
Who dares to finance Eni and Exxon’s dangerous Rovuma gas plans in Mozambique?
2023-03-14 14:59:00
New ING policy could spark bank shift away from financing oil and gas infrastructure
2023-02-24 13:46:14
Pego power station conversion plans halted
2022-12-14 11:08:26
HSBC announces it will no longer finance new oil and gas fields
Connect
2022-11-22 00:00:00
Banking on Thin Ice: Two years in the heat
2022-11-17 00:00:00
BankTrack Global Human Rights Benchmark 2022
2022-10-21 00:00:00
Burning forests in the name of clean energy? How banks are failing to exclude the harmful wood biomass industry from finance
2022-06-28 00:00:00
The East African Crude Oil Pipeline (EACOP): Finance Risk Update No. 3
2022-04-05 00:00:00
The BankTrack Human Rights Benchmark Asia
2022-03-30 00:00:00
Banking on Climate Chaos 2022
See all publications
Sections
Banks Dodgy Deals Campaigns
Our campaigns
Banks and Climate
Banks and Human Rights
Banks and Nature
Banks and Pandemics
Our projects
Tracking the NZBA
Banks and Putin's war in Ukraine
Tracking the Equator Principles
Tracking the PRBs
Find a Better Bank
Banks and the OECD Guidelines
Media
News Publications
Fossil Banks No Thanks StopEACOP Forests & Finance Banks & Biodiversity Drop JBS Bank of Coal Don't Buy into Occupation
BankTrack
About BankTrack Visit us Organisation Our team Our board Guiding principles Team up with us Jobs at BankTrack Our annual reports Funding and finances History BankTrack in the media Our privacy policy Donate
Successes Contact BankTrack
Donate Mailing list Facebook Twitter Login
Home › Dodgy Deals ›
Dodgy Deal
PetroperúPeru

Company – Active

This profile is actively maintained
Lead organisation:
BankTrack
Work partners:
Amazon Watch
Contact:

Ryan Brightwell, BankTrack

Giulia Barbos, BankTrack

Moira Birss, Amazon Watch

Mary Mijares, Amazon Watch

Last update: 2022-10-27 00:00:00
Achuar protest vs. Petroperú in block 64, 2013. Photo: Andrew Miller, Amazon Watch

Company – Active

This profile is actively maintained
Lead organisation:
BankTrack
Work partners:
Amazon Watch
Contact:

Ryan Brightwell, BankTrack

Giulia Barbos, BankTrack

Moira Birss, Amazon Watch

Mary Mijares, Amazon Watch

Last update: 2022-10-27 00:00:00
Why this profile?

Why this profile?

As the world’s largest rainforest, the Amazon is known as the “lungs of the Earth.” However, exploitative extractive companies such as Petroperú, continue to operate in the Amazon basin despite severe social and environmental consequences. Petroperú’s operations have devastating effects on biodiversity and the climate, impacting local Indigenous peoples and their livelihoods. As a result, Petroperú faces widespread opposition from communities and civil society groups, both in Perú and abroad.

What must happen

In line with the Paris Agreement goals, banks and other financial institutions should not provide any new financing for Petroperú while it continues to seek to expand oil and gas operations. Financial institutions should also adopt and strengthen policies mitigating abuses on Indigenous rights, such as Free, Informed, and Prior Consent (FPIC).

About
Sectors Oil and Gas Extraction
Headquarters
Ownership

Petróleos del Perú (Petroperú S.A) is a state-owned company under private law belonging to the Peruvian State since 1969. It has been listed on the Lima Stock Exchange since 2010. 

 

Subsidiaries
Website https://www.petroperu.com.pe

Petroperú is a state-owned company involved in the exploration, refining, and distribution of oil and gas. Its headquarters are in Lima, Peru.

Petroperú operates in the midstream business, transporting crude oil from the Peruvian Amazon to the coast through the North Peruvian Pipeline. It is also active in the downstream business, refining and commercializing oil derivatives. This includes operating Perú's second biggest oil refinery in Talara, which recently underwent a major modernization program. Since 2021, the company returned to the upstream business, and restarted oil production at the Block I field on the North Peruvian coast. In addition, the company is seeking to operate other blocks, including Block 64.

Impacts

Impact on human rights and communities

  • North Peruvian Pipeline: The pipeline constantly leaks, which has caused innumerable social and  environmental damages. This situation has led to tense relationships with the Indigenous communities opposed to oil drilling on their land and are forced to live alongside the pipeline. These communities actively protest and seek legal action, creating stoppages and a never-ending barrage of claims against the company.

  • Block 64: Indigenous communities impacted by the possible exploration of Block 64 – the Achuar People of the Pastaza River and the Autonomous Territorial Government of the Wampis Nation – which Petroperú is seeking to operate soon, see the company as a harmful operator that will cause similar environmental impacts as those associated with the North Peruvian Pipeline.

  • Block 192: Communities impacted by operations in Block 192 have accepted oil operations after years of complex negotiations over liability remediation, health care, basic services, and damage compensation. Their expectation is that the Peruvian State will remedy the environmental liabilities left by the previous operators. However, remediation is far from being completed since no operator seems to want to be in charge of cleaning up costly environmental liabilities. The former operators of Block 192 had disagreements with the communities and environmental regulators about who should remedy the environmental liabilities left by the previous operator. 

  • Additional Blocks: Currently, the Peruvian government is advocating for other blocks located on the Peruvian coast and the Amazon to be operated by Petroperú, once their respective concession contracts with other private operators end, between 2023 and 2028. All of these future blocks are in a similar situation as Block 192, meaning they have unresolved environmental liabilities without a willingness on the side of current operators to assume these liabilities. Under this situation, Petroperú will be potentially assuming responsibility for the environmental impacts on those blocks. 

11369
kid.jpeg
center
A child plays around the common yard in the Kukama indigenous community of San Pedro in the northern Peruvian Amazon. The region is marked by oil operations, primarily operated by state-run company Petroperú.
Photo: Caroline Bennett, Amazon Watch

For sources and further information, please see Amazon Watch, "The Risks of Investing in Petroperu", Fall 2022


Impact on climate

The oil and gas industry is a major source of pollution in the western Amazon. Under these circumstances, the blocks that Petroperú intends to operate – 192 and 8 located in Datem del Marañón, Loreto – have an unresolved history of contamination. Since 1997 there have been 422 spills in this region. In the same period on the North Peruvian coast, close to the Talara Refinery, there have been 404 spills. 

Similar circumstances are present in Blocks 192 and 8, and will probably also occur in the other blocks that Petroperú intends to operate in the future on the North Peruvian coast. In addition, the operations of Petroperú in the Peruvian Amazon have caused long-term environmental liabilities, affecting the surrounding communities that depend on nature to survive. Mainly, the operation of the old and deteriorated North Peruvian Pipeline caused more than 94 oil spills between 2001 and 2019. Despite this situation, Petroperú continues with operations that have cost the company approximately $4.3 million dollars just in remediation of environmental liabilities.

11368
oil.jpeg
center
An oil spill flows down Chuuntsa Creek in Oil Block 1-AB, in the Peruvian Amazon..
Photo: Amazon Watch.

 


Impact on nature and environment

The oil and gas industry in particular is a major driver of deforestation in the western Amazon, where oil companies often are the first to cut down trees in order to carve roads into the rainforest. Industrial activities such as oil and gas drilling in Peru, driven by Petroperú, undermine biodiversity that’s essential for maintaining healthy ecosystems, providing fresh water, pollination cycles, soil fertility, and food production, as well as protecting against the spread of zoonotic illness and species extinction. The loss of biodiversity, coupled with constant pollution and deforestation, directly affect Peruvian communities and Indigenous groups living in voluntary isolation. Biodiversity is also inextricably linked to climate, such that good functioning of both is required for our quality of life. 

11365
pp_1.jpeg
center
Oil sheens on the surface of the Marañón River in the northern Peruvian Amazon. Within six months of 2013, five separate spills resulted from breaks in Petroperú’s North Peruvian pipeline. The company has declared the site “remediated.”.
Photo: Caroline Bennett, Amazon Watch

 


Impact on pandemics

After the departure of Geopark from Block 64 in 2020, the block has been under the administration of Perupetro (the Peruvian oil licensing agency), and the license of operations under Petroperú (the state-run oil company). In February of 2022 – with the ongoing COVID-19 pandemic – Perupetro organized a “community gathering” to introduce the new operator Petroperú to the communities potentially affected by its operations in Block 64. Since Perupetro went against government advice to not to carry out face-to-face consultations to limit the risk of contagion, the Achuar and the Wampís Indigenous peoples denounced Perupetro for putting their lives at risk.


Other impacts

Allegations of corruption

Petroperú’s high-level executives are politically appointed. This situation represents a risk for investors because Petroperú’s corporate governance and administration depend on the government in power. Allegations have often been made involving the misuse of resources and corporate relationships involving officials accused of or investigated for corruption. 

In fact, Petroperú has a history of corruption scandals and crises due to the mismanagement by these high-level executives. The government of current Peruvian president Pedro Castillo has been no exception. Over the past months, Petroperú has entered into a crisis precipitated by a corruption scandal involving President Castillo, the President of the Board of Directors, and the Chief Executive Officer, which catalyzed the departure of key high-level executive managers and the financial collapse of the company.

Financial risks

Petroperú’s mismanagement due to the poor selection of high-level executives has plunged the company into one of its worst financial moments. Petroperú is submerged in a financial hole caused by its over-indebtedness due to the modernization of the Talara Refinery coupled with very little crude oil production. Under the political appointees of President Castillo, Petroperú has shown very little financial transparency, leading to the downgrading of its credit rating by S&P and Fitch. Poor governance and little transparency represent a financial risk for investors.

Financiers

Commercial banks are financing Petroperú via corporate loans, project finance and underwriting services. See below for more details on which banks are involved.

Institution type
Finance type
Year
News
BankTrack
Partners
Blog
External
BankTrack news BankTrack blog Partner news Partner blog

Amazon Watch Rebuts False Claims of Consultation with Indigenous Communities by Vanguard-Financed Peruvian Oil Company

Petroperú fails to allay the risks for investors, communities, and the climate of its planned expansion in the Amazon rainforest; Vanguard fails to respond
2022-10-06 | Amazon Watch
BankTrack news BankTrack blog Partner news Partner blog

Victory: Corporations Behind Climate Week Exposed for Ties to Amazon Destruction

Thousands of Indigenous, frontline, and community activists gathered at NYC Climate Week demanding climate justice
2022-09-29 | Amazon Watch
BankTrack news BankTrack blog Partner news Partner blog

Peru indigenous groups block river in the Amazon after oil spill

2022-09-29 | Reuters
BankTrack news BankTrack blog Partner news Partner blog

Petroperú ahora buscará socio para operar Lote 64 pero su producción no saldría antes de año y medio - $

2022-09-22 | Gestión
BankTrack news BankTrack blog Partner news Partner blog

Climate Week NYC: Peruvian Oil Company Petroperú is Toxic for International Investors

New Amazon Watch report details Petroperú's threats to the climate, Indigenous rights, and its investors' bottom line
2022-09-21 | Amazon Watch
BankTrack news BankTrack blog Partner news Partner blog

Vanguard Funds Indigenous Rights Violations in Peru’s Amazon

Asset manager Vanguard must stop investing in Indigenous rights violations and environmental destruction
2022-09-09 | Amazon Watch
BankTrack news BankTrack blog Partner news Partner blog

From local to global: Peruvian earth defenders confront Deutsche Bank in Germany

Delegation of Indigenous leaders from the Amazon built networks of support and solidarity in the movement against oil expansion in the Amazon
2022-08-01 | Amazon Watch
BankTrack news BankTrack blog Partner news Partner blog

Amazonian communities in Peru try to keep oil-rich Block 64 in their own hands

2022-07-07 | Mongabay
BankTrack news BankTrack blog Partner news Partner blog

From Peru to Uganda, activists call on Deutsche Bank to drop fossil finance

2022-06-28 | Reuters
BankTrack news BankTrack blog Partner news Partner blog

Petroperú’s Ongoing Threat to the Amazon

2022-04-12 | Gisela Hurtado-Barboza, Amazon Watch
BankTrack news BankTrack blog Partner news Partner blog

A month since the oil spill, Wampis indigenous peoples criticize PetroPeru’s negligence

2016-03-04 | Mongabay
BankTrack news BankTrack blog Partner news Partner blog

Indigenous communities are forced to clean up a 3,000-barrel oil spill in Peru’s Amazon

2016-02-26 | Mongabay
BankTrack news BankTrack blog Partner news Partner blog

Petroperú Slicks Seep On in the Amazon

2015-01-15 | Caroline Bennett, Amazon Watch
Resources
Documents
Images
2021-04-19 00:00:00

Sustainability Report 2020

Company document
2021-04-19 00:00:00 | Petroperú
2021-03-31 00:00:00

The Shadow of Oil

A report on oil spills in the Peruvian Amazon from 2000 to 2019
NGO document
2021-03-31 00:00:00 | CNDDHH - Coordinadora Nacional de Derechos Humanos and Oxfam
2022-10-06 00:00:00

Amazon Watch Rebuts False Claims of Consultation with Indigenous Communities by Vanguard-Financed Peruvian Oil Company

Petroperú fails to allay the risks for investors, communities, and the climate of its planned expansion in the Amazon rainforest; Vanguard fails to respond
NGO document
2022-10-06 00:00:00 | Amazon Watch
2022-09-28 00:00:00

The Risks of Investing in Petroperú

NGO document
2022-09-28 00:00:00 | Amazon Watch
2022-10-14 00:00:00

Financial statements 2021

Company document
2022-10-14 00:00:00 | Petroperú

Petroperú's adverse impacts in pictures

2022-10-24
 An indigenous monitor visits a spill caused by a pipeline rupture in Oil Block 1-AB near the community of Antioquia.  Oil sheens on the surface of the Marañón River in the northern Peruvian Amazon. Within six months of 2013, five separate spills resulted from breaks in Petroperú’s North Peruvian pipeline. The company has declared the site “remediated.” Remnants of “remediation” mark a recent oil spill site near Cuninico, a Kukama Indigenous community on the Marañon River in the northern Peruvian Amazon.  In 2013, five separate spills resulted from breaks in Petroperú’s North Peruvian Pipeline.
Updates

2022

2022-10-24 00:00:00 | 2022 List of Operations

2022 List of Operations

Current operations

  • Talara Refinery Modernization Project
  • North Peruvian Pipeline
  • Block 64 (License to operate) 
  • Block 192 (License to operate) ​
  • Block I (License to operate) 

Potential future operations 

  • Block 8 (Suspended) ​
  • Blocks II, V, VI_VII, X, XV,Z-2B (Blocks with expiration dates)
11371
operations_1.png
center
Petroperú is currently interested in operating 3 oil blocks. Of those blocks only one (Block I) is operational while the two others (Blocks 64 and 192) are suspended..
Photo: Amazon Watch based on public information (2022)
 
Send feedback on this profile
Sections
Banks Policies Dodgy Deals Campaigns
Our campaigns
Banks and Climate Banks and Human Rights Banks and Nature Banks and Pandemics
Our projects
Tracking the NZBA Banks and Putin's war in Ukraine Tracking the Equator Principles Tracking the PRBs Find a Better Bank Banks and the OECD Guidelines
Media
News Publications
Fossil Banks No Thanks StopEACOP Forests & Finance Banks & Biodiversity Drop JBS Bank of Coal Don't Buy into Occupation
BankTrack
About BankTrack Visit us Organisation Our team Our board Guiding principles Team up with us Jobs at BankTrack Our annual reports Funding and finances History BankTrack in the media Our privacy policy Donate
Successes Contact BankTrack
Vismarkt 15
6511 VJ Nijmegen
The Netherlands
Tel: +31 24 324 9220
Contact@banktrack.org
Donate Mailing list Facebook Twitter
©2022 BankTrack
BankTrack is a registered charity in the Netherlands (ANBI) - RSIN 813874658
Find our privacy policy here

Stay up to date

Sign up now for all BankTrack's news


Make a comment

Your comment will be reviewed, before being posted