April 17, 2013 / 3:05 PM / 7 years ago

Peru's prime minister confirms interest in Repsol refinery stake

LIMA, April 17 (Reuters) - Peru could potentially buy a stake in one of the country’s two main oil refineries from Spain’s Repsol to help ensure adequate fuel supplies to consumers, Prime Minister Juan Jimenez said late on Tuesday.

Jimenez, who stressed that any investment would amount to a minority stake and not a controlling one, said he has sought to ensure Peruvian business groups in recent days that the government is not pushing a statist agenda at the expense of private companies that might also bid for the refinery.

“Basically the financial situation of the plant is being evaluated for the possibility of an investment that would not be majority but partial,” he said on Canal N television.

“There is a lot of nervousness in the corporate sector over this,” he said. “I have told them my message is that the government will continue to sensibly manage the economy.”

A Reuters exclusive on April 3 said state-run Petroperu had submitted a preliminary bid to buy the Pampilla refinery of Repsol - even as there were disagreements within Petroperu about whether it should agree to take on some $1.6 billion in liabilities for environmental improvements and other upgrades at the plant.

The plant has capacity of 102,000 barrels a day and is one of Peru’s two main refineries. Pampilla produces about half of the refined products in Peru, a net crude importer.

Petroperu was told to look into the investment by the mines and energy ministry as part of President Ollanta Humala’s efforts to guarantee domestic production, a source said at the time.

Humala ran for office on a platform that emphasized greater state control over “strategic” sectors like natural gas and oil, although since taking office he has sought to lure more foreign investment to the sector in what has been South America’s fastest-growing economy.

“Leaving ideology aside, we have to look at what is best for the country, to make sure there is no shortage of energy, which is something we are concerned about,” Jimenez said.

Repsol did not provide an immediate comment. In February, Repsol sold liquefied natural gas assets to Royal Dutch/Shell for $4.4 billion in cash and the assumption of $2.3 billion in debt as part of a plan to protect its credit rating.

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