Petroecuador Overcomes Operational Setbacks in First Quarter

Researched by Amir Richani for Industrial Info Resources (Sugar Land, Texas)--Petroecuador, the national energy company of Ecuador, achieved strong exports and stable midstream flows in the first quarter, despite disruptions related to unrest and operational issues.

The company recently released statements detailing its midstream, export and downstream results from January through March.

Petroecuador reported a total fuel production of just more than 16 million barrels in the first quarter. According to the statement, the 110,000-barrel-per-day (BBL/d) Esmeraldas Refinery contributed 65% of the volumes, while the 20,000-BBL/d Shushufindi and 45,000-BBL/d La Libertad refineries accounted for 14% and 21%, respectively.

Subscribers to Industrial Info's Global Market Intelligence (GMI) Petroleum Refining Plant Database can read detailed profiles of the Esmeraldas, Shushufindi and La Libertad refineries.

On the export front, Petroecuador shipped more than 25 million barrels of oil and fuel oil in the first quarter. From January through March, the company exported 13.3 million barrels and 9.31 million barrels of heavy Oriente and Napo grades, respectively. The remaining 2.6 million barrels exported were fuel oil No. 6.

Most of the sales were attributed to long contracts, as only 10.2 million barrels of oil and fuel oil were sold through the spot market. Sales in the spot sector generated US$677 million in the first quarter.

Midstream flows through the Trans Ecuadorian Oil Pipeline (SOTE), for their part, stood at almost 27 million barrels in the first quarter. About 10 million barrels of oil were transported each month in January and March. In February, however, the volume fell to about 6.8 million barrels after a bridge collapse on the Marker River forced a weeklong shutdown on SOTE, impacting oil transportation and production.

During the first quarter, Petroecuador faced several challenges that hampered its performance and could affect its goals for the remainder of the year. For example, the shutdown of the SOTE pipeline dropped Ecuador's oil output by almost half.

Petroecuador also declared force majeure in five northern oil blocks in the first quarter, including the ITT, one of the nation's largest, due to unrest from local communities. Nevertheless, the company was able to solve the issue following negotiations.

In the first three months, Petroecuador averaged an oil output of about 375,000 BBL/d, and 395,000 BBL/d when operational disruptions or unrest did not impact production. These numbers accounted for almost 80% of Ecuador's total output.

Nevertheless, in an interview with Democracia TV earlier this year, Energy Minister Fernando Santos said that the disruptions experienced in the first quarter likely would affect the nation's efforts to reach production of 520,000 BBL/d by the end of the year.

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