Ecuador’s Petroecuador lost 1.99 million barrels of oil in protest

An infrastructure of Ecuador’s state oil company Petroecuador is pictured outside Nueva Loja, Ecuador May 3, 2022. REUTERS/Santiago Arcos

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QUITO, July 1 (Reuters) – More than two weeks of protests in Ecuador have caused state oil company Petroecuador to lose 1.99 million barrels of oil production, the company said on Friday, adding it expects to reach 90% of pre-crisis production. out next week.

Protests erupted in Ecuador in June demanding lower fuel prices and limits on the expansion of the mining and oil industries, leading to at least eight deaths and devastating oil production. A pact to end the crisis was signed Thursday between the government of President Guillermo Lasso and indigenous leaders. Read more

The incident cost the company some $512.9 million, more than half of which came from lost production, while Oriente’s missed crude exports – which were declared force majeure plus earlier this week – cost him some $110 million.

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“We found destroyed, vandalized facilities,” Petroecuador director Italo Cedeño told a news conference.

The company said it had recovered 19,000 barrels per day (bpd) of production since protests ended on Thursday, while its Esmeraldas refinery was operating at 70% capacity on Friday.

As part of the deal to end the protests, the government agreed to a full reduction in fuel prices at the pump by 15 cents per gallon, which is expected to push oil subsidies in the country to 2.78 billion a year, Cedeño said. .

Petroecuador was forced to issue a broad declaration of force majeure in the oil industry on June 18. The advisory, applied earlier this week on crude exports, is expected to be lifted on July 7, once the company can assure customers that supply contracts will be fulfilled. .

The commitments include a key supply contract with US refiner Marathon Petroleum (MPC.N) which Petroecuador hopes to preserve, Cedeño said. Ecuador has become the second largest supplier of heavy oil to the West Coast of the United States after Canada.

Crude production rose slightly to 262,500 bpd on Thursday from a low of 234,310 bpd the day before, following the reopening of oil fields, power lines and other energy infrastructure.

More than 1,200 wells had been closed due to dwindling fuel supplies and roadblocks during the protests. Petroecuador has not yet completed an assessment of the total reopening and reactivation costs, the executive said.

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Reporting by Alexandra Valencia, writing by Oliver Griffin and Marianna Parraga. Editing by Jonathan Oatis and Marguerita Choy

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