Peru opens Petroperu to private capital as losses mount

Jose Jeri has approved an emergency decree allowing private investment in parts of Petroperu, a sharp turn aimed at shoring up the cash-strapped state oil firm as losses and debts pile up.

Announced just before the new year, the measure allows Petroperu to be reorganised into one or more asset units, clearing a path for private participation in core operations. That includes the flagship Talara refinery, which recently emerged from a $6.5bn modernisation that has weighed heavily on the company’s balance sheet.

Beyond Talara, Petroperu runs or holds concessions for six crude oil blocks with limited output, alongside a nationwide fuel distribution and marketing network.

In a statement, the Peru Ministry of Energy and Mines said the decree is designed to “ensure compliance with financial obligations through technical management of its assets, laying the foundation for Petroperu to become a self-sustaining company”.

The ministry described the firm’s finances as “particularly sensitive”, pointing to accumulated losses of $479m between January and October 2025 and supplier debts of $764m through December, on top of $774m in losses the year before.

Petroperu’s strain has been aggravated by debt linked to the Talara upgrade, which ultimately cost about twice its original estimate and led to the company losing its investment-grade credit rating in 2022. Since then, the state has repeatedly stepped in, injecting roughly $5.3bn between 2022 and 2024 to keep the company afloat.

The restructuring push also lands amid wider turbulence. Petroperu has faced environmental scrutiny after a 2024 oil spill along Peru’s northern coast triggered an “environmental emergency” and a government investigation. Politically, the backdrop is no steadier: leadership churn has been rapid, with three board chairs appointed in just three months.