(Reuters) – Ecuador on Tuesday launched a bidding round for foreign companies to develop oil and gas reserves, hoping to attract some $800 million in investment to boost production in the Andean nation’s sluggish economy.
Winners will operate four oil fields in Ecuador’s eastern Amazon region and one natural gas field in the gulf of Guayaquil under 10-year service contracts, officials said, adding that payments will be linked to global oil prices.
The Cuyabeno-Sansahuari, Yuralpa, Oso and Blanca-Vinita fields produce 36,300 barrels per day (bpd). The government hopes to raise output by about 15,000 bpd.
“Current (oil) prices allow us to increase activity in eastern Ecuador to boost employment, boost production and explore for new reserves,” Alex Galarraga, manager of state-run oil company Petroamazonas, said during the announcement of the tender.
The Amistad natural gas field has production of 39 million cubic feet per day, which the company expects will rise by 11 million cubic feet per day. Ecuadorean President Lenin Moreno has said the government plans to increase crude production by 80,000 barrels per day (bpd) this year by adding barrels from the Amazon area.
Oil Minister Carlos Perez said Ecuador was producing below its quota allowed by the Organization of the Petroleum Exporting Countries (OPEC), so it has room to raise output.
The auction process is expected to be completed in June.
Companies will be able to carry out drilling, well completion, reactivation of closed wells and construction of required facilities.
