The preliminary investment estimate reaches $2.072 billion for the complete system, which will deliver a reference design capacity of 346 million cubic feet per day. This capacity allows for potential expansion if project scope evolves during development. The ninth contract amendment proposes extending TGP’s BOOT concession by 10 years beyond its current January 8, 2034 expiration, pushing the final transfer date to January 8, 2044.
A significant commercial innovation appears in the proposal’s petrochemical tariff structure. TGP has requested approval for a special tariff category applicable exclusively to natural gas volumes destined for petrochemical industry use. This pricing mechanism aims to encourage fertilizer production and other industrial derivatives along the coast between Pisco and Tacna, leveraging Camisea gas as industrial feedstock rather than only fuel.
The project addresses a critical infrastructure gap for southern Peru’s Nodo Energético del Sur, which includes thermal generation plants in Ilo and Mollendo with combined capacity around 1,500 MW. These facilities were designed for natural gas operation but have lacked pipeline access since construction.
Energy Minister Guillermo Shinno confirmed the government requested TGP extend the pipeline beyond the original Moquegua endpoint earlier in 2026. The ministry is now evaluating the modified technical and financial conditions before approving the contract amendment. Shinno indicated the expansion forms part of a broader strategy to develop redundant gas transmission routes across Peru, reducing vulnerability demonstrated during the March 2026 pipeline incident that left Lima and Ica without natural gas for 13 days.
The TGP Extensión Sur project was originally announced in October 2024 as a complement to the stalled SIT-Gas initiative, which has remained paralyzed for nearly a decade.
This article was curated and published as part of our South American energy market coverage.
