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Monday, February 04, 2008

Venezuela, Ecuador to construct US$5.5 billion (€3.7 billion) refinery

IHT, 1 February, 2008

QUITO, Ecuador: Venezuela's and Ecuador's state oil companies will team up to build a US$5.5 billion (€3.7 billion) oil refinery in Ecuador, the Oil and Mining Ministry said Friday.

A joint venture by Petroecuador and Petroleos de Venezuela SA, or PDVSA, the refinery in the coastal province of Manabi will have a processing capacity of 300,000 barrels a day, the ministry said in a statement.

The proposed oil refinery is part of "Ecuadorean President Rafael Correa's and Venezuelan President Hugo Chavez's commitment to energy integration," the statement said.

In a speech last month marking his first year in office, Correa, a close ally of Chavez, blamed Ecuador's 2.67 percent 2007 economic growth — one of the lowest rates in the region — on a 9.8 percent decline in oil production.

Delegates from Petroecuador and PDVSA plan to sign a shareholders agreement in March to formalize the venture, known as the Pacific Refinery Mixed Economy Company.

Ecuador is South America's fifth-largest oil producer, with a daily production of about a half-million barrels of crude.

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