PERU Oppening to investment AAPG 2010 PERUPETRO S

PERU Oppening to investment AAPG 2010 PERUPETRO S. A. April, 2010

PRESENTATION OUTLINE • 1. PERU: 100 YEARS OF PETROLEUM HISTORY • 2. ECONOMY OVERVIEW • 3. EXPLORATION ACTIVITIES • 4. PRODUCTION AND INFRASTRUCTURE

1. PERU: 100 YEARS OF PETROLEUM HISTORY

Petroleum History Summary • In 1859 the 1º Wildcat was drilled in Titusville, Pensilvannia – USA Edwin Drake. • In 1863 the first tubular drilling in Zorritos area-Tumbes Basin took 24 days to be completed. TD was 24 mts. and produced 500 bls of 25º API oil. • 1864 - Zorritos – The first refinery in Latin America was built in Bebedero location, Tumbes Basin by Cía. Peruana de Refinar Petróleo (Peruvian Oil Refining Co. ). • 1873 - Brea y Pariñas – First well produced 400 Bpd at 330 feet, Talara Basin.

Petroleum History Summary • 1908 - Lobitos Oilfields Ltd. took an area to explore. • 1920 - International Petroleum Co. starts operations in the Talara basin. • 1922 - The first Petroleum Law is given. • 1938 - Ganso Azul Co. drilled the 1 er wildcat in Aguas Calientes field in the Ucayali Basin. • 1957 - A new discovery in the jungle Maquia: “El Oriente” Co. Iquitos Refinery to be built • 1961 - Mobil discovers Gas in Aguaytía field, Ucayali Basin. • 1966 - La Pampilla Refinery is built in Lima, Peru

Petroleum History Summary • 1969 - Petroperú is created • 1971 - Petroperú discovers the Corrientes field in the Marañón Basin. • 1971 - 1975 Exploration boom in the jungle basins. • 1974 - Petroperu started production in Marañón. • 1977 - The first jungle oil arrives in Bayóvar port through the northern Pipeline. • 1980 - National Production reaches 195 M Bbls/d • 1984 - Shell discovers the Camisea Gas field. • 1990 - Review of the petroleum policy. Petroperu privatization started.

Petroleum History Summary • 1993 - The actual Hydrocarbons Organic Law is given. • 1993 - Perupetro S. A. was created. • 2000 - Operations started in Camisea gas field. • 2004 - Camisea starts gas production. • 2000 -2008 - 87 contracts in force

2. ECONOMY OVERVIEW

Why invest in Peru? GDP growth: 9. 3% annually (2008) • Sustained growth since 2002 and forecast above 6% annually 2009 -2011. • Exports tripled in 5 years. • Investment is increasing 20% annually. Regional Hub • Third largest country in South America / 28 million inhabitants. • Located at the center of the South American Pacific Coast. Vast Natural Resources: • Ores, hydrocarbons, available lands having proper climates, forests, 2 500 km of coast, hundreds of lakes, snowcapped mountains. Economy committed to the commercial integration process : • Preferential access to CAN, MERCOSUR, USA and EU. • 32 agreements on investment. Favorable climate for investment: • Country with Investment Grade • Attractive legal framework for Foreign Direct Investment, based on freedom and equality. • First place in Latin America regarding the State receptiveness to investment (WEF). • Second place in Latin America for protecting the Foreign Direct Investment (WB). Country risk below the Latin American average • One of the lowest inflation in Latin America and a very stable exchange rate (free). • Domestic capital market’s sound growth. • Fiscal surplus of 3. 1% (2007).

Investment plays an important role in the country’s Economic Growth and signals a promising future 2004 2005 2006 GDP (%change) 5. 1 6. 4 7. 6 8. 9 9. 3 Private Investment (%change) 8. 1 12. 0 20. 1 23. 4 24. 6 Public Investment (%change) 5. 7 12. 2 13. 0 19. 7 44. 7 CPI (%change) 3. 5 1. 1 3. 9 6. 7 Jobs in companies with 10 or more workers (% change) 3. 6 5. 7 8. 9 8. 4 Exports (% change in US$) 40. 9 35. 3 36. 9 17. 5 14. 3 Capital goods imports (% change in US$) 19. 6 29. 6 35. 4 41. 9 60. 3 4. 7 8. 4 14. 7 16. 6 17. 0 13. 6 14. 3 27. 8 15. 3 10. 3 Construction GDP (% change) Tax collection (% change) Sources: Central Reserve Bank of Peru, Ministry of Economy (MEF) and National Institute of Statistic and Information * Preliminary figures 2007 2008*

3. EXPLORATION ACTIVITIES

Regional Setting Hydrocarbon Trends Paiche and Dorado heavy oil fields Hydrocarbon Area Tumbes Basin Peru Subandean hydrocarbon Trend Camisea and Candamo gas fields Bolivia Subandean Gas Trend

Regional Setting Undrilled Structures • PERUPETRO has identified a total of 415 undrilled exploration prospects. • Most of them where defined by 2 D seismic. • 286 prospects are located in the subandean basins.

EXPLORATION ACTIVITIES HAS INCREASED CONSIDERABLY Areas under Contracts

Areas with Major Potential Wildcats in the Southern Basins of Peru Ucayali and Madre de Dios Basins Block / Company Year Wilcat 42 Shell 75 Shell 1984 1986 1987 1998 San Martín 1 X Cashiriari 3 X Mipaya 5 X Pagoreni 75 -29 -1 X Discovered Field San Martín Cashiriari Mipaya Pagoreni 78 Mobil 1999 Candamo 78 -53 -1 X Candamo 57 Repsol 2007 Kinteroni 57 -29 -1 X-ST 1 Kinteroni 58 Petrobras 2009 Urubamba 1 X Urubamba 100% Exploratory success ¡¡¡

CONTRACTED AREAS & IN COURSE PROJECTS ØAs a consequence of intensive promotion and international biddings 2006 -2008, PERUPETRO has 87 contracts signed to december 2009. Last signing ceremony was on April, 2009. ØAt present investments are mainly focused in heavy oil production in the North Jungle and Natural Gas and Condensates production in Camisea and adjacent Blocks. ØAn important increase of exploration investment in different areas of the country is expected in the near future.

3. PRODUCTION AND INFRAESTRUCTURE

1998, heavy oil discovered, block 67 2005, 2006, heavy oil discovered, block 39 Production of the Blocks 1 AB and 8 : 30, 000 bpd 2005, 2009, Light Crude Oil Discovered Heavy oil-ITT

PRODUCTION & PIPELINE INFRASTRUCTURE PIPELINE • CAPACITY 200 MBPD MARAÑON PRODUCTION • PRESENT PRODUCTION: • 40, 000 BPD. . . 16” 252 Km 24 MBPD 36” 548 Km 24” 306 Km 16 MBPD

GAS - CONDENSATE PRODUCTION 2008, Kinteroni discovered, 2 TCF San Martin, Cashiriari and Pagoreni production 88 2009, Urubamba discovered, 2 TCF 1998, Candamo discovered, 2 TCF

PRODUCTION & PIPELINES INFRASTRUCTURE 18” 170 Km 14” 10” 211 Km 32” 349 Km 211 Km 24” 349 Km GAS PIPELINE • CAPACITY 300 MMCFD Future upgrade (450 MMCFD) CAMISEA PRODUCTION • PRESENT PRODUCTION: 300 MMCFD. . .

LIQUID HYDROCARBON PRODUCTION 145, 000 BPD OIL 71 K NGL 74 K MAINLY CAMISEA Nov 07 Dic 09

GAS PRODUCTION 350 MMCFD CAMISEA 280 MMCFD Nov 2007 NW ONSHORE NW OFFSHORE Dic 2009 UCAYALI BASIN

FREE AREAS FOR PERUVIAN BIDDING ROUND TO BE ANNOUNCED IN MAY 18 th, 2010 HOUSTON JW MARRIOTT, WESTHEIMER FREE REGISTRATION promotion@perupetro. com. pe

THANK YOU VERY MUCH FOR YOUR ATTENTION! VISIT US IN BOOTH: 845 www. perupetro. com. pe