January 11, 2013 / 5:35 PM / 5 years ago

UPDATE 1-Ecuador oil output up 0.8 percent in 2012, under target

* Output reached 504,000 bpd, target was 510,000 bpd
    * State-run and private companies invested $1.67 bln in 2012

    By Eduardo Garcia
    QUITO, Jan 11 (Reuters) - Ecuador's oil output increased 0.8
percent last year to an average of 504,000 barrels of per day
(bpd), less than the 510,000-bpd target set by the government,
the energy ministry said on Friday.
    Ecuador is OPEC's smallest member, and in 2011 its average
production reached 500,000 bpd, up from 486,000 bpd in 2010.
    Ecuador's energy minister, Wilson Pastor, said in July the
country aimed to increase average oil production to 530,000 bpd
in 2013, up from the 2012 target. 
    After taking office in 2007, Ecuador's leftist president,
Rafael Correa, introduced reforms to increase state revenue from
the oil industry, and since then foreign oil companies have not
invested in new projects.
    State-run energy companies Petroamazonas and Petroecuador
invested $1.34 billion in 2012, almost the same as a year
earlier, while foreign oil companies invested $330 million, down
from $421 million in 2011, the ministry said in a statement.
    The ministry said that an increase at the Sacha oil field
was one of the key reasons allowing Ecuador to raise overall
production slightly.
    Sacha, which is controlled by Venezuela's state-run company
PDVSA and Petroamazonas, produced some 63,000 bpd in 2012, a 26
percent increase compared to the previous year. 
    Spain's Repsol SA and Chinese-owned Andes Petroleum
both have operations in Ecuador, but the biggest producers are
the country's state-run companies, whose output accounts for
about 70 percent of total production. 
    Starting on Jan. 1, Petroecuador transferred control of its
fields to Petroamazonas, which is now the state's upstream oil
company. Petroecuador is now the downstream company and runs
three refineries and a key oil pipeline. 
    In November, Ecuador launched a licensing round for 13 oil
blocks in Amazon areas near the border with Peru, while
Petroamazonas plans to tap three more blocks nearby. 
    Ecuador is upbeat that it will attract investments worth at
least $1 billion in oil exploration in all the blocks.
    According to the government, preliminary studies show there
are between 400 million and 1.6 billion barrels of crude oil
reserves in that region. 
    Ecuador's economy is heavily dependent on oil exports. 
    Higher crude prices have allowed Correa to hike social
spending in recent years, which in turn has boosted his
popularity among the country's poor majority ahead of a
presidential election scheduled for February.

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