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UPDATE 2-Peru to review Pluspetrol contract after deadly protests
February 12, 2015 / 8:07 PM / 3 years ago

UPDATE 2-Peru to review Pluspetrol contract after deadly protests

(Adds company reaction and comment from Interior Ministry)

LIMA, Feb 12 (Reuters) - Peru will evaluate a natural gas contract it signed with Pluspetrol in 2005 and is asking the Argentine company to leave a restive Amazonian town following deadly protests there, the government said on Thursday.

Pluspetrol started exploratory activities in natural gas block 108 last year, upsetting locals in the town of Pichanaki who fear it will lead to pollution and hurt farming.

Energy and Mines Minister Eleodoro Mayorga said he believes the company has complied with its contract for developing block 108 but that the government must make sure.

"That contract must be evaluated," Mayorga said on state television from Pichanaki, which is located in Peru's Amazonian region of Junin.

"I would like to know about advances that have been made, and if they've been made with all the permits this type of work requires," Mayorga said.

Mayorga traveled to Pichanaki to calm tensions after street protests against the company left one young man dead and dozens injured on Tuesday.

The Interior Ministry said it is investigating the illegal use of firearms by police personnel during the demonstrations.

Pluspetrol said in a statement that it has met all legal, environmental and social requirements for exploratory work in block 108, including more than 2,000 agreements with farmers and communities.

Protesters in Pichanaki have called for Pluspetrol's departure, a demand that Mayorga said he would try to fulfill.

"I'm going to ask the company to leave Pichanaki within three days, the time it needs to go and take everything it has brought," Mayorga told cheering crowds in a televised speech.

Pluspetrol said it would remove its remaining equipment from Pichanaki in coming days, provided it is safe enough to do so.

Protesters vandalized and looted a storage unit used by Pluspetrol on military land in Pichanaki on Tuesday, the army said.

The government of President Ollanta Humala, a former leftist military officer who turned to the right upon election in 2011, okayed Pluspetrol's environmental study for block 108 in 2013.

The concession is expected to hold significant reserves of natural gas.

Pluspetrol is also struggling to end conflicts in Peru's northern Amazon, where indigenous protesters have taken control of oil wells and halted 3,100 barrels of output per day in the country's biggest oil block.

Pluspetrol also leads a consortium that operates Peru's biggest natural gas field, known as Camisea. (Reporting by Mitra Taj and Marco Aquino; Editing by Richard Chang and Leslie Adler)

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