Vice Minister of Electricity recommends that Petroecuador speed up the tender for Campo Amistad, to face future droughts

The Vice Minister of Electricity, Enith Carrión, recommended to the manager of Petroecuador, Hugo Aguiar, to speed up the processes to make the tender for block 6 of Campo Amistad viable “in the shortest possible time.” According to Carrión, “the increase in the availability of national natural gas will contribute to maximizing in the short, medium and long term the security in the supply of energy to the country at competitive costs, with clear economic benefits for Ecuadorian society.”

The communication to Aguiar, signed on January 20 by the high state officialwas sent in the midst of a controversy generated by learning that there are interests from the importing sector, recognized by the minister Fernando Santos himself, that do not allow taking the necessary steps to stop using diesel in various oil operations. Additionally, The Friendship tender, which was announced by the minister for before the end of 2022, has not yet finished.

In his letter, Carrión explained the reasons why it is urgently required to ensure the supply of energy in the country, through this fuel that can replace diesel because it is cheaper and more environmentally friendly.

from the scope electricity, he pointed out that the dry season that culminates in March of this year, which reduces the availability of hydroelectric generation, is being managed; but it warns that depending on the aggressiveness of the new drought that begins in October 2023 and ends in March 2024, this “could once again place the electricity sector in a position of vulnerability, making necessary the use of all primary energy sources for the production of electrical energy, including natural gas”.

He recalled that the State portfolio defends and promotes the priority use of energy resources with the aim of guaranteeing the supply of energy to the population. He recalled that in 2022, Ecuador imported approximately 76% of the fuels it uses, which represented a cost of around $7.5 billion.

Likewise, the national production of natural gas would be approximately 40% cheaper than its import. “These figures show that it is imperative to reduce imports and increase national production in order to improve our trade balance,” he said.

He also commented that due to the low volumes of natural gas available for the electricity sector, it has been necessary to implement adjustments in Termogás Machala for the use of diesel fuel to replace natural gas, decreasing its efficiency and increasing operating costs. Likewise, the bidding process for the 400 MW capacity Natural Gas Combined Cycle Block is being finalized, with the consequent increase in the country’s natural gas requirement.

In this sense, he reminded the manager that it is public knowledge that in the block 6 of Campo Amistad there are at least 4 wells with the potential to workover and that 6 new wells would have studies, analysis and approvals from the Ministry of the Environment, Water and Ecological Transition, which would make its exploitation viable, which we understand could increase gas production this year.

In addition, he asks the current manager of Petroecuador “remit the availability of natural gas for the period October 2022 to September 2024, ratifying or rectifying the previously informed values”. This, because he said, Cenace has found certain inconsistencies in previous information that was sent in October 2022.

And he reminded him that through Official Letter No. MEM-VEER-2022-0341-OF of December 15, 2022, the Vice Ministry requested Petroecuador to provide an estimate of the current availability of natural gas production in Campo Amistad, considering the gradual decline in production, with the execution of the new natural gas exploration and exploitation project in Campo Amistad.

He stressed that the information requested will allow progress with the planning of the Electricity Master Plan 2022-2031, a relevant input for the electricity sector. (YO)