Diego Harman

Garrigues acts on $26m LC of Altamesa Energy

Garrigues Peru has advised the international lender on the signing of a $26m Letter of Credit (LC) with Altamesa Energy in favour of Perupetro, Peru’s state-owned oil and gas company.

The LC was issued in favour of Altamesa Energy as a requirement for the latter to secure a 61% participation in the Block 192 Licence Contract, awarded by Perupetro in favour of Petroperu in February 2023, consolidating its position as a strategic operating partner in the development of the country’s main crude oil producing field.

This transaction, closed on 19 March, will allow for the 30-year exploitation of Block 192, Peru’s largest oil field. This initiative promises to ignite a resurgence of oil activity throughout Loreto, where the oil field is located.

Other participating firms were Allen & Overy as English counsel to the lender; Torys LLP and Lavery as Canadian counsel to the lender; Norton Rose Fulbright as English and Canadian counsel to the borrower; and GSA Legal as Peruvian counsel to the borrower.

State-owned oil company Petroperu is the original licensee of Block 192. In 2019, Petroperu, together with its financial advisor Bank of America Merrill Lynch, launched an international bidding process to select a partner to enter into a Joint Operating Agreement for the operation of Block 192. As a result of this tender, Altamesa Energy was awarded the right to assume a 61% interest in the oil field, whereby the Block 192 License Agreement was amended in March 2024 to allow for joint ownership of the field between Altamesa Energy (61%) and Petroperu (39%).

Block 192, located in the Loreto region of northern Peru, is one of the most important oil blocks in the country, covering 512,347.241 hectares. It has been a focus of exploration and production activities for decades, attracting both national and international attention due to its economic and environmental importance.

Garrigues’ team was led by partner Diego Harman (pictured), with support from associates Giancarlo Vignolo, María José Cardoza, Rodrigo Ramos and Jimena Valega.

L Giselle Estrada