Peru taps fuel reserves to confront worst energy crisis in two decades

The pipeline rupture forced the government to release fuel reserves, halt natural gas exports and prioritize supply for households and essential services.

Peru has decided to tap its fuel reserves to protect domestic supply and contain the impact of what is already being described as the country’s worst energy crisis in the last 20 years, following a gas pipeline rupture that severely disrupted the national energy system.

The measure was announced by Prime Minister Denisse Miralles, as authorities moved to respond to the emergency triggered by the shutdown of a section of pipeline operated by Transportadora de Gas del Perú (TGP) in the Megantoni district. The incident led to restrictions in gas deliveries to industrial users and the power sector, while the government prioritized residential demand and essential services.

Peru halts gas exports and prioritizes domestic demand

As part of its response, Peru suspended natural gas exports while seeking to stabilize the energy system and limit the fallout from the supply disruption.

The government also moved to encourage remote work in both the public and private sectors, while shifting schools to online learning, in an effort to ease pressure on energy consumption and mobility during the crisis.

These emergency measures followed the dramatic reduction in gas supply caused by the rupture, which quickly escalated into a nationwide energy crunch.

Energy minister warns gas deliveries dropped to just 10%

Energy and Mines Minister Angelo Alfaro told Congress that the disruption had caused an extraordinary collapse in gas supply.

“The reduction in the gas supply has been tremendous … only 10% is being delivered,” he said, underlining the severity of the crisis and the strain now facing Peru’s energy matrix.

The disruption is particularly significant because Peru relies heavily on domestic natural gas for electricity generation, industrial operations, transportation and household consumption. The rupture has therefore exposed the vulnerability of a system that depends on critical gas infrastructure.

Pluspetrol suspends LPG production at Pisco plant

One of the most serious consequences of the emergency has been the suspension of liquefied petroleum gas (LPG) production at Pluspetrol’s Pisco fractionation plant.

The facility accounts for roughly 70% of Peru’s LPG consumption, making the interruption a major concern for the domestic fuel market. With production halted, supply pressures have intensified and fears of broader shortages have grown.

At the same time, the National Chamber of Mining, Oil and Energy (SNMPE) said its members were working to reduce the impact on the population and were exploring the possibility of importing an LPG shipment in record time.

Energy crisis raises concern for Peru’s mining sector

The crisis is also raising alarm across Peru’s mining industry, a sector that plays a central role in the country’s economy and is one of the largest consumers of domestic energy.

Peru is the world’s second-largest copper producer, and any prolonged disruption in gas and electricity supply could affect operating continuity, raise costs and put additional pressure on mining and industrial activity.

In this context, the emergency has reopened the debate around Peru’s energy security, the resilience of its gas transportation network and the need for more robust contingency mechanisms for strategic infrastructure.

Government seeks to contain economic and social fallout

By releasing fuel reserves, suspending gas exports and prioritizing essential demand, the Peruvian government is trying to prevent a deeper supply shock and limit the economic and social consequences of the crisis.

However, the incident has already highlighted the fragility of a system that remains highly dependent on a critical gas corridor.

As repair works continue in Megantoni, attention will remain focused on how quickly supply can be restored and what impact the disruption may have on electricity generation, fuel markets, transport and mining operations in the days ahead.