The Ecuadorian state oil company Petroecuador has stopped producing about 40% of crude oil from its fields located in the Amazonian provinces of Orellana and Sucumbíos due to protests led by indigenous people, its general manager, Ítalo Cedeño, reported Thursday.
In a statement, the company indicated that this percentage was equivalent, until Wednesday, to an accumulated loss of 451,914 barrels of oil, while the daily drop in production as of this Thursday is almost 155,000 barrels, when before the mobilizations it was close to 400,000 barrels a day.
Added to this are 781 shutdown wells and 31 paralyzed drilling rigs.
These figures would represent approximately a “direct economic damage to the country of 45 million dollars, considering a price of WTI (a barrel of Texas) of 100 dollars.”
This, according to the Petroecuador statement, without counting the damage to the hydrocarbon infrastructure, theft and sabotage of equipment, among other actions “caused by groups outside the company that seek to violate its facilities and stop operations.”
As a result of these acts, which Cedeño described as “sabotage and vandalism”, several generation plants that provide electricity to oil blocks and small pipelines were also stopped.
Currently, the Trans-Ecuadorian Oil Pipeline System (SOTE) is without oil to pump, which is why “force majeure” was declared in a timely manner throughout the company’s value chain, to avoid lawsuits and fines for contractual commitments previously acquired, the statement said.
“The effects are in all the oil fields, especially in Sacha, Lago Agrio, Auca, Libertador, Coca Payamino – Yuralpa, Cuyabeno, Shushufindi and Indillana, which are continuously attacked by protesters,” he said.
“(We make the) greatest efforts with extended hours so as not to stop operations since the situation is worrying and if it continues in the same way we will only have three to four days of operational life to be able to work in these conditions,” Cedeño added.
The demonstrations led by the Confederation of Indigenous Nationalities of Ecuador (Conaie) due to the high cost of living have included the blocking of highways in different provinces, as well as the blocking of roads in some cities, especially Quito.
With regard to shipments and provision of fuel, Petroecuador pointed out that it has sought the appropriate mechanisms and joint action with other institutions to ensure that the tankers pass to their final destinations, especially guarded by the public force.
However, “due to the blockades and due to situations beyond the work of the state oil company, they have not been able to reach their final destinations, the consequence of which is the shortage of derivatives in several provinces,” he said.
“Our operations are strategic and a public service, as established by the Constitution of the Republic, cannot be paralyzed or violated. The country is strongly feeling the consequences of the strike and the effects are disastrous,” added the general manager.
Affectation of 110 million dollars
In total, according to the estimate of the Ecuadorian Government, the effect of the first eight days of protests on the country’s economy reaches 110 million dollars, as reported on Wednesday by the Ministry of Production, Foreign Trade, Investments and Fisheries in a statement.
Of that amount, some 40 million dollars correspond to export sectors, while for each day of paralysis, the area of the Andean highlands, where the bulk of the mobilizations are concentrated, stops producing each day for the national economy about $3.5 million. (YO)