Spanish ECA's US$1.3 billion loan to PetroPeru pushes delayed audit

(Paris Beacon-News, Paris, 5 May 2022) Price Waterhouse Coopers (PWC) will carry out the external audit of the 2021 financial statements of the state company Petroperú in an effort to recover the confidence of creditors, bondholders, banks and risk rating agencies and hopefully allow negotiation of a request for consent from bondholders and the Spanish Export Credit News (CESCE) to reschedule presentation of last year’s financial statements. CESCE granted PetroPeru a loan of US$1,300 million in 2018 for the modernization of the Talara refinery and, a year earlier, Petroperú placed US$2,000 million in bonds in international debt markets to finance the same project, which has started performance tests last April. The recent PetroPeru crisis led debt rating agencies Standard & Poor’s and Fitch to reduce Petroperú’s credit rating due to a lack of financial transparency, exacerbated by the delay in having last year’s financial statements audited. Petroperu was downgraded earlier this month to junk by credit agencies after accounting firm PwC declined to audit the company's financial statements in the middle of a corporate governance crisis in which Petroperu's previous CEO Hugo Chavez resigned on amid allegations that he had improperly hired a company to provide him with personal security and people were saying audit firms did not feel comfortable enough to audit Petroperu while Chavez was in charge. On top of this, PetroPeru is demanding compensation of up to $34.5 million from the Spanish oil giant Repsol after freak waves from a volcanic eruption near Tonga caused an oil spill described as the worst ecological disaster to hit Peru in recent history, claiming that Repsol's Pampilla refinery “apparently” did not have a contingency plan for an oil spill.