US Ex-Im Bank Rejects $213.6 Mln for Peru Gas Project | Amazon Watch
Amazon Watch

US Ex-Im Bank Rejects $213.6 Mln for Peru Gas Project

August 28, 2003 | Campion Walsh; 202-862-9291; campion.walsh@dowjones.com (Virginia Rey-Sanchez in Lima contributed to this story.) | Dow Jones

Washington – The U.S. Export-Import Bank’s board voted 2-to-1 Thursday to reject a proposed $213.6 million loan guaranty for Peru’s controversial Camisea natural gas project.

“The application was declined…because it did not fully meet Ex-Im Bank’s environmental guidelines,” Bank spokesman Phil Cogan said of the Camisea project, which aims to bring gas from deposits in southern Peru to Lima by
mid-2004.

In a prepared statement Ex-Im Bank Chairman Philip Merrill said the vote was specific to the Camisea project’s situation and doesn’t reflect the Bank’s overall position toward financing U.S. exports for energy projects.

The Inter-American Development Bank has been considering offering Camisea developers a $75 million direct loan and a $60 million syndicated loan. An IDB board vote on that proposed financing is currently expected Sept. 10, but could be delayed at board members’ request, a Bank spokesman said.

More than $1 billion has already been invested in the exploration and development, transportation and distribution sections of the Camisea project,which has estimated reserves of up to 13 trillion cubic feet of gas and up to 600 million barrels of natural gas liquids.

In 2000, Peru awarded contracts for the Camisea project to Argentina’s Pluspetrol SA, U.S.-based Hunt Oil Co. (HUN), South Korea’s SK Corp., (Q.SKG), Argentina’s Techint Group (I.TCH) and others.

Company officials have said they are ready to use private sector funds to complete the project should the multilateral loans be denied.

Ex-Im Bank is an independent federal government agency that helps finance the sale of U.S. exports. While it’s technically an independent agency, the bank considers advice on proposed financing from other agencies directly under the president.

Environmental groups and some members of Congress have been asking the Treasury Department, which represents U.S. interests at the multilateral IDB, to oppose planned Camisea financing before the IDB board.

John Sohn of Friends of the Earth, one of the environmental groups currently opposed to Camisea, said it’s still unclear if President George W. Bush’s administration has a unified position against financing the gas development that it would advance at the IDB.

“I think it’s still up in the air, but I think (the Ex-Im Bank vote) is a good signal,” Sohn said.

Sohn said the project raises key social and environmental concerns including: gas drilling in a reserve where isolated indigenous people live; construction of pipeline through pristine rain forest vulnerable to erosion; and building of a natural gas liquids export terminal in the buffer zone of Peru’s Paracas marine reserve.

He said companies and potential lenders should conduct more environmental due diligence before proceeding further.

PLEASE SHARE

Short URL

Donate

Amazon Watch is building on more than 25 years of radical and effective solidarity with Indigenous peoples across the Amazon Basin.

DONATE NOW

TAKE ACTION

Stop the Flow of Money to Oil Company Petroperú!

TAKE ACTION

Stay Informed

Receive the Eye on the Amazon in your Inbox! We'll never share your info with anyone else, and you can unsubscribe at any time.

Subscribe