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Tue, May 27, 2008 - Page 10 News List

OPEC to help Ecuador boost its slowing production


OPEC’s secretary-general has promised to help Ecuador boost oil production and refining, Ecuador’s oil ministry said on Sunday, even as the cartel hesitates to increase oil output worldwide.

OPE will help Ecuador, South America’s fifth-largest oil producer, “modernize” its oil fields and increase sagging output, a ministry statement quoting Abdalla Salem El-Badri said.

OPEC will also train Ecuadoran technicians to run a US$5 billion oil refinery that Ecuador plans to build on its Pacific coast in cooperation with Venezuela, the statement said, giving no other details.

Production at Ecuador’s state oil company has fallen more than 3 percent since December to 169,000 barrels a day — well below its 180,000 barrels a day target, prompting the company’s chief to resign last Tuesday. Petroecuador accounts for about a third of the nation’s oil output.

El-Badri visited Ecuador for five days last week, telling reporters that speculators, not supply shortages, were responsible for soaring world oil prices. Ecuador rejoined OPEC in October, after 15 years on its own.

The ministry said El-Badri also voiced support for Ecuador’s efforts to seek compensation from other countries in return for not tapping oil reserves in Yasuni National Park, a UNESCO Biosphere reserve.

Ecuadoran President Rafael Correa’s government has threatened to open the jungle reserve to bidders unless the “international community,” which he has not defined, agrees to pay Ecuador a minimum of US$350 million a year for 10 years by June 15.

Environmental groups like Amazon Watch support that proposal, noting that the Yasuni reserve, which sits on an estimated 1 billion barrels of crude, has more varieties of plant life than the US and Canada combined.

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