Crude pre-sales will go to renegotiation

Ecuadornews:

They are “seriously concerned.” An upheaval in Petroecuador management model and issues such as investment in the Pacific Refinery, service contracting models and calculation formulas in oil pre-sales are questioned.

Petroecuador hopes to impose a new formula in the oil presales negotiated with China and Thailand.

The anticipated sales of crude are operations the Ecuadorian State made with foreign banks and oil companies. In exchange for securing the supply of crude oil for a certain period of time, the state oil company of a country (China or Thailand) delivers a cash amount in advance.

Petroecuador now seeks to calculate the price of the presales with the Platts formula, an international publication that sets costs according to the movement of the market. Previously it was done based on the Argus publication.

“We sit down to negotiate on equal terms. Ecuador is sovereign,” said yesterday manager of Petroecuador Byron Ojeda at an improvised press conference.

With this formula, the manager said that they expect the Ecuadorian barrel to add 50 cents to its price. It is still necessary to deliver to China and Thailand approximately 530 million barrels so that the application of the new calculation could represent $ 265 million in favor of Ecuador. (I)

Source: http://www.expreso.ec/economia/preventas-petroleo-renegociacion-refineria-ecuador-NA1750807