tives is to promote foreign and domestic private investment in exploration, refining, and marketing operations. The government is especially eager to encourage exploration of the gas-rich Camisea fields. While the opportunities for participation in Peru's oil and gas sectors by foreign companies are potentially great, a number of issues must be satisfactorily addressed in order to realize the investment targets.
The most important policy issue is the ability of the Peruvian government to ensure the safety of private and foreign investments that are threatened by radical groups' attacks and nationalistic sentiments. Another important issue is the solution of the 1985 expropriation of the offshore properties belonging to Belco (a subsidiary of the Houston-based Enron Corporation) and various other financial disputes between Petroperú and foreign oil companies. Furthermore, the growing influence of environmental groups in the country may complicate the government's efforts to increase oil production and attract foreign investment. On the political front, the dispute between the current administration and the congress, and the subsequent move of President Fujimori to dissolve the congress, have posed some problems for the government's new policy initiatives. In light of these difficulties, the prospects for a smooth and successful privatization of Peru's state oil and gas sectors are questionable.