Ecuador and Chile's ENAP subsidiary renegotiate their oil agreement
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Ecuador and Chile's ENAP Subsidiary Revise Agreement for Amazon Oil Block
In a significant development for the Ecuadorian oil sector, the Ministry of Energy in Quito announced the renegotiation of an existing deal with a subsidiary of Chile's state-owned oil company, ENAP. This new agreement centers on the exploitation of an oil block in the Ecuadorian Amazon and entails an additional $90 million investment stretching until 2035.
Details of the New Agreement
The updated contract, initially signed on July 15, involves the ministry and ENAP SIPEC, the current operator of the block. This renegotiated deal is projected to boost reserves by 5.6 million barrels of crude oil, according to Energy and Mines Minister Antonio Goncalves. The substantial investment is expected to be front-loaded, with 98% of the committed funds being deployed within the first five years.
Background and Current Operations
ENAP initially entered the Ecuadorian market in 2010 through a service contract to operate three blocks. The operation of Block 46, situated in the Orellana province in northeastern Ecuador, has been a focal point. This block, producing 16,700 barrels per day (bpd), saw its first renegotiation in early 2021.
As of July 18, 2024, ENAP's total oil production in Ecuador stood at 28,443 bpd, based on official data.
