In a small bowl mix the peppercorns and salt. Coat the roast on all sides with the oil and season evenly with the peppercorn mixture. Allow the roast to stand at room temperature for 1 hour before grilling.
Soak the wood chips in water for at least 30 minutes.
In a food processor or blender process the pesto ingredients, except the oil. Then, with the motor running, slowly add the oil to make a thin paste. Season with salt and pepper. Pour into a serving bowl, cover and let stand at room temperature while cooking the roast.
Prepare the grill for indirect cooking over medium–low heat (about 180ºC).
Brush the cooking grates clean. Drain and add one handful of the wood chips to the smoker box of a gas grill, following the manufacturer’s instructions, and close the lid. When the wood begins to smoke, cook the roast, bone-side down, over indirect medium–low heat, with the lid closed, until the internal temperature reaches 51ºC to 54ºC for medium rare, about 2¼ hours. Drain and add the remaining wood chips to the smoker box after the first hour of cooking.
Remove the roast from the grill and let rest for about 20 minutes. Cut the roast into thick slices and serve warm with the pesto.
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