Hunt Oil and Halliburton seek financing for Camisea project

Two Texas-based energy companies with close ties to the Bush administration are part of a huge natural gas development project in Peru and hope to obtain financing backed by the US government. Peruvian officials view the Camisea project, with an estimated cost of $ 1.45 bn in its first phase, as crucial to gaining energy independence and repaying the country's $ 230 bn foreign debt.
Environmentalists worry that the project could destroy the Lower Urubamba River basin near the Camisea River. It has one of the world's most biologically diverse and pristine rain forests. The jungle area about 700 miles east of Lima, Peru, is believed to hold 13 tcf of natural gas as well as oil. Peru hopes to begin piping gas over the Andes to the coast by mid-2004.

Hunt Oil of Dallas has teamed with two Argentine companies, PlusPetrol and Tecgas, for the planned $ 600 mm exploration project, $ 800 mm pipeline and $ 50 mm natural gas distribution network. Halliburton of Houston is designing a $ 1 bn terminal toship liquefied gas from the Peruvian coast to the United States.
The companies hope to obtain nearly $ 1 bn in public financing, including $ 210 mm in loan insurance from the Export-Import Bank and $ 75 mm in loans from the Inter-American Development Bank, which also would coordinate another $ 240 mm in loans from a group of banks. Next month, Hunt Oil is sending its vice president, Steve Suellentrop, on a trade mission to Peru accompanying Commerce Secretary Donald Evans, Hunt spokesman Jim Oberwetter said.

President Bush visited Peru in March. A report said that Hunt and Halliburton were "lining up administration support" for the financing.
"These projects are decided on merit, and that's all we'll say," Oberwetter said. Wendy Hall, a spokeswoman for Halliburton, said the company was not involved in the financing process. "We've done the front-end engineering but we're not involved in any financing," Hall said.
In September, environmental groups such as Amazon Watch, Rainforest Action Networkand Friends of the Earth told the Export-Import Bank that the pipeline would contaminate waterways and species' natural habitat. Both Hunt Oil and Halliburton, a leading energy service company, have close ties to the Bush administration and the Republican party.

Vice President Dick Cheney is a former chairman and CEO of Halliburton. Hunt Oil and its employees have given GOP candidates and committees more than $ 500,000 since the 1990 general election, according to the Centre for Responsive Politics.
Ray Hunt, the company chairman, is a long-time friend and financial supporter to Bush, giving at least $ 90,000 to his two gubernatorial campaigns, according to the Centre. Hunt's son, Hunter Hunt, a vice president, was a member of Bush's presidential energy transition team and an energy adviser during the 2000 presidential campaign. The government-operated Export-Import Bank, whose chairman was selected by Bush, helps US companies finance sales overseas and compete against often heavily subsidized foreign competitors. The United States is the largest shareholder, with 30 % of the shares, in the Inter-American Development Bank.