Letter rectifying SERVINDI

Mr
Jorge Agurto
Agencia de Noticias SERVINDI
Calle El Parque N° 211, 2do. Piso.
Urbanización San Roque
Santiago de Surco
Lima.-

Of our consideration,

In a publication made on the SERVINDI website, entitled "PETROPERU evades its responsibility in oil spills", some inaccurate statements are made that we proceed to clarify.

1. The note states, with respect to PETROPERU, that "there is an attempt to cover up... that said company is responsible for the deplorable state of the pipelines and that it refuses to comply with a resolution of the Environmental Assessment and Inspection Agency (OEFA) that requires it to be maintained".
   
   This is not correct. PETROPERU has questioned before the Judiciary the competence of the OEFA to impose actions or sanctions on technical issues - such as maintenance - of the North Peruvian Pipeline (ONP). This is the responsibility of another supervisory entity: the Supervisory Body for Investment in Energy and Mining (OSINERGMIN). The contentious administrative process raised by the Company on the subject of the functional competencies of supervisory bodies has no causal relationship with the issues of maintenance to the pipeline.
   
   That is why the assertion is not correct either according to which - and quoting Mr. Ruiz Molleda - “we have to wait for the administrative contentious process to end, so that Petroperú has just complied with the resolution that orders it to maintain the Norperuano Pipeline. So the native communities affected by the spills will have to wait between 5 to 8 years to finally maintain the Pipeline, in compliance with OEFA Resolution 012-2016-OEFA ”.
   
   The fact is that PETROPERU has given maintenance to the ONP. It is public knowledge that between 2016 and 2017 it was given comprehensive maintenance with the highest technology available to ensure its normal operation. In addition, the maintenance tasks mentioned in the article - in addition to others, additional - are permanent activities carried out by the Company; so it is not possible to "refuse" to do them. Consequently, we reiterate that the pipeline has been maintained, regardless of the result of the aforementioned administrative contentious process.
   
   Moreover, in 2016, the Government issued Legislative Decree 1292 that declares the safe operation of the North Peruvian Pipeline of public necessity and of national interest, which empowers PETROPERU to authorize the investments and expenses that are necessary for the proper operation of the North Peruvian Pipeline to ensure maintenance, sustainability and infrastructure improvements. In that sense, the Company is investing up to US $ 300 million in pipeline improvements until 2021.
2. The article states that "behind the thesis of third-party sabotage lies another reality unknown by the press and public opinion and that it is characterized by breaches, negligence and even the alleged commission of corruption offenses" in the hiring of "companies without sufficient experience, financial capacity and uptime", supposedly related "to PETROPERU officials". Again, here two different themes are mixed: the attacks on the pipeline made by third parties and the companies contracted to carry out remediation work.
   
   Regarding the former, it should be clarified that the vast majority of incidents that have affected the ONP have been caused by third parties or by geodynamic causes (that is, attributable to nature). Since its commissioning, 116 incidents have occurred (not all have been spills), of which 72 have occurred due to third parties, 31 for geodynamic reasons and 13 for technical reasons.
   
   Nor is the statement made in the article that PETROPERU attributes these attacks to native communities or indigenous peoples. The Company has stated that these are acts performed by unscrupulous people who seek economic benefits and that should not be confused with native communities. It is up to the Public Ministry to assess these facts, investigate and punish those responsible; since these acts affect us all, but mainly the native communities.
   
   On the second point, it should be clarified that the local companies referred to were in charge of non-specialized jobs since these, in turn, were subcontracted by companies with extensive experience and international expertise, such as Lamor or Kanay; which, in addition, have worked under the technical supervision of specialized PETROPERU personnel. Therefore, the activities of containment, collection, cleaning and environmental remediation of these contingencies have been carried out under the highest standards in terms of attention to these events. Moreover, this was established by an international expert nominated by the communities near the town of Chiriaco, regarding the cleanup and remediation activities of a spill that occurred on Km 441 of the ONP in 2016, caused by the movement of a hill.
   
   It should also be clarified that, since 2017, PETROPERU does not use this labor intermediation system for the services of these contingencies. Currently, international companies that are awarded the service are obliged to directly hire local labor in cases of spills caused by geodynamic phenomena or technical reasons; and bring their own workforce when the contingency is caused by third party damages.
3. With regards to the alleged relations between PETROPERU officials and a subcontracted remediation company until 2017, the competent area initiated an investigation in this regard, and if there were any irregularities, the Company will act according to law. However, it should be mentioned that - in the previous hiring system - the aforementioned local companies should always have the authorization of the communal authorities. At present, this situation is no longer present because - due to transparency - companies to meet these contingencies are contracted by public tender.
4. Finally, it should be noted that, since its creation, PETROPERU maintains a permanent commitment to the Amazon and the native communities. Not only is it one of the main contributors in the country, but it also makes the oil fee viable through the service provided by the ONP; with resources that arrive directly to the producing regions.
   
   In addition, it develops social responsibility programs in the areas of health, education, capacity development and implementation of productive projects; as bio-gardens, cutting and sewing workshops, poultry production project, among others.
   
   He has also published a considerable volume of academic studies and the main literary works written about the Peruvian Amazon; as well as pictorial, photographic and musical presentations aimed at preserving the heritage of the indigenous peoples of the Amazon.

We are surprised that the editor of the note or a representative of Servindi has not made contact with us in order to provide him with the official position of the Company and absolve any doubts that the medium may have about the particular one; we think that for a minimum balance in the information it was important to consider our version. We are at your disposal for this purpose at the time you see fit.

Finally, we request the publication of this in order to achieve the information balance mentioned above.

Best regards,

Beatriz Alva Hart
Corporate Manager of Social Management and Communications

CAR-01