Tue, Aug 23, 2005 - Page 7 News List

Ecuadorean troops protect oil industry

REVENUE SHARING Last week's strike drastically reduced oil production, forcing the country to halt exports. Protest leaders are now in Quito for talks with officials


A soldier stands guard at Ecuador's state-run Petroecuador on Saturday in the town of Nueva Loja. Ecuador has slowly resumed crude oil production, though not exports, after the military took control of oil wells occupied by protesters last week.


Ecuador's government has deployed troops to its Amazon region and claimed an end to six days of civil unrest that had cut oil exports, but protesters declared only a truce in their fight for a larger slice of oil revenues.

About 60 protest leaders arrived in the capital Quito late Sunday in military planes to hold talks with the government in a bid to end a strike that has cost millions of dollars.

"We granted a suspension to talk with administration officials, but lifting the strike depends on the agreements we reach," Orellana provincial governor and protest leader Guadalupe Llori said earlier in a telephone interview.

However, Interior Minister Mauricio Gandara said late on Saturday that residents of the region "had decided to end the strike."

"Reason has prevailed and people will be returning to work because the damage from the strike has been enormous, reaching about US$500 million," the minister said.

The government of President Alfredo Palacio declared states of emergency in Sucumbios and Orellana provinces in Ecuador's Amazon basin on Wednesday when protesters demanded a greater share of oil revenues.

Defense Minister Oswaldo Jarrin, whose predecessor resigned on Friday, said the states of emergency would remain in force.

The protests forced Ecuador to suspend oil exports, a key source of foreign exchange, costing the country some US$30 million a day.

Ecuador is South America's fifth-largest oil producer and more than half of its exports go to the US. It also supplies Asian nations.

Private companies produce 340,000 barrels a day, but their output was cut to about 150,000 barrels because of the dispute, said Rene Ortiz, a spokesman for the private oil firms.

State oil firm Petroecuador resumed oil production on Sunday after it was shut down. But instead of the normal 201,000 barrels a day, its output was at 54,000 barrels, Energy Minister Ivan Rodriguez said.

Rodriguez said on Sunday that Ecuador may take up Venezuelan President Hugo Chavez' offer to make up any shortfall in oil needs.

"Possibly this week we will travel to Venezuela to work out a deal allowing us to import crude or [oil] derivatives or both," he said.

Troops lifted roadblocks and protected oil facilities from attack, Petroecuador said in a statement.

"With the cooperation of the armed forces we have managed to reopen some roads and gain access to the operational areas, thanks to which the oil workers can restart operations in those stations and wells which are not heavily affected" by the protests, it said.

The protesters, including government officials and lawmakers, want foreign oil companies to build 200km of roads in their regions and to give more jobs to locals.

They also want the government to renegotiate all contracts with foreign oil companies and demand 50 percent of oil profits.

The Roman Catholic Church and an association of provincial councils will mediate the government talks, protest leaders said.

Clashes between demonstrators and security forces have left at least 60 injured, said Sucumbios Governor Guillermo Munoz. He was arrested late on Friday, along with Maximo Abad, mayor of Lago Agrio, for allegedly leading the protests. The pair were later freed.

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