PetroTal might halt oil output at Peru's Block 95 due to protests

Canadian producer PetroTal's crude shipments to Brazil have been blocked by local community protests in the northern Peruvian jungle, the company said Nov. 24.

PetroTal was unable to load river barges with crude from its Block 95 concession in the Maranon Basin after "the social unrest situation evolved quickly," the Calgary-based company said in a statement. Protesters are demanding greater social spending from the government.

"PetroTal will curtail production to manage its oil tank storage capacity," the company said. "If this situation persists, a full field shut down may be required within a few days due to the lack of excess storage capacity and route to market."

The company has been storing crude at its installations since similar protests halted pumping at state oil company Petroperu's 200,000 b/d North Peruvian Oil Pipeline Oct. 5.

PetroTal, which exports 240,000 b/month of crude to Brazil, is negotiating an increase in shipments with a trading firm, CEO Manolo Zuniga said on a Nov. 18 conference call.

The company is working on a $100 million expansion of the Block 95 concession's Bretana field, and was producing 15,131 b/d at the end of the third quarter. It plans to complete a $13.9 million horizontal well and a CPF-2 crude processing plant at the field this month.

PetroTal, which supplies crude to Petroperu's 62,000 b/d Talara and 12,000 b/d Iquitos refineries, aims to boost production to 24,000 b/d in 2022.

Peru's oil production was running at a 10-year high in late 2019. The output has fallen steadily since, as Canada's Frontera Energy and Pluspetrol of Argentina halted production at their fields in the northern jungle. Crude output rebounded 17% to 44,282 b/d in October from 37,851 b/d a year ago.