Race on for Odebrecht’s Peruvian pipeline contract

Canada’s Brookfield Asset Management and China National Petroleum Corp (CNPC) are said to be competing for a US$ 4 billion stake in a Peruvian natural gas pipeline project.

Recently, it appeared Brookfield had beaten off its rivals and was set to acquire the 55% share of the project from Brazilian firm Odebrecht.

However, the interest from CNPC – China’s largest petroleum producer – seems to have thrown the deal into confusion.

Another bidder on the project, US-based Sempra Energy, withdrew from talks over a clause in the contract, which allows the Peruvian government to cancel contracts if wrongdoing is proven against Odebrecht.

Odebrecht has been embroiled in a corruption investigation in Brazil, which recently culminated in the US Department of Justice ordering the firm to pay around $2.6 billion over the bribing of government officials, both in Brazil and internationally.

According to a Bloomberg source, the Peruvian government could cancel the pipeline project’s licence if financing is not approved by January 23.