(OGJ, 24.Jan.2014) — China National Petroleum Corp. (CNPC) and the Ecuadorean government have reached an agreement regarding cooperation in a plan to construct a long-delayed refinery on Ecuador’s Pacific Coast.
Jan. 21, Ecuador’s Vice-President Jorge Glas and CNCP Chairman Zhou Jiping
reached a joint-approval of the feasibility report for the Refineria del
Pacifico (RDP), according to a release from Ecuador’s government.
During a second meeting on Jan. 23, Glas further solidified the deal with representatives of Industrial and Commercial Bank of China, who expressed an interest in handling financing for CNPC in the refinery project, Glas said.
This latest arrangement, for which no official financial details have been disclosed, follows the signing of June 2013 of a framework agreement between Ecuador and CNCPC on integrated cooperation in developing RDP.
While no firm timetable was available regarding final funding for RDP, once realized, the refinery project will be a significant step in utilizing Ecuador’s oil production domestically to reduce the country’s dependence on petroleum product imports, according to Glas.
Under the June 2013 agreement, CNPC said it will take a share in the construction of RDP as well as participate in the exploration and development of Ecuador’s upstream resources. At the time, the RDP refinery and petrochemical complex was scheduled for completion by 2017, Ecuadorean President Rafael Correa said in a Jun. 29 release.
The planned RDP, which began as a joint-development between Ecuador (51%) and Venezuela (49%) has faced a series of financial and political setbacks since its inception in 2007, with both countries seeking from the outset foreign companies to both bid on and provide 70% of financing for the refinery’s construction (OGJ Online, Dec. 2, 2008; July 17, 2008).
In 2007, Ecuadorean President Rafael Correa said the proposed 300,000-b/d RDP, to be built in the coastal province of Manabi, would cost around $5 billion, increasing to $10 billion if the partners decided to add a petrochemical plant on the site (OGJ Online, May 13, 2008).