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The first spot sale of crude oil in the year received six offers
Posted On 30 Jan 2018
Ecuadornews:
Petroecuador will export 3.6 million barrels of Crude Oriente. The companies proposed spreads of up to – $ 0.18 per barrel. The hydrocarbon was released from pre-sales contracts. In less than four months Petroecuador returned to market crude in the spot market (without intermediaries).
It is the second operation of this type carried out by the public company since September of last year. Seven companies presented their offers for the export of 3’600,000 of Crudo Oriente. Yesterday was the opening of envelopes, one of the bidders did not meet all the requirements. Seven other firms excused themselves from participating. The differentials proposed for each exported barrel are based on the price of WTI crude oil (reference for the price of Ecuadorian oil).
The ranges ranged from – $ 0.18, from the Repsol company, to – $ 5.14, from Vitol INC. The award will be announced today. The 3.6 million barrels of hydrocarbon will be shipped in 10 vessels of 360,000 barrels each. Carlos Tejada, general manager of Petroecuador, said that it is a transparent process and open to all interested companies, provided they are qualified for the sale of crude oil and derivatives. “The offers we now receive is what the market is giving (…) has nothing to do with previous or subsequent negotiations,” he said. Half of the valid proposals come from oil refining companies, which is a good sign for the authorities, because it differs from previous bids.
The oil that Petroecuador took to the market was released from the advance sales contracts, after reaching consensus with the companies involved in China and Thailand, confirmed Patricio Larrea, deputy minister of hydrocarbons. Future spot sales are not yet defined by Petroecuador, as they depend on the progress of the negotiations carried out by the Ecuadorian government with Unipec, Petrochina and Petrotailandia.
Market
The first spot sale
In September 2017, Ecuador returned to the market for the direct sale of crude oil, after maintaining an international marketing policy that privileged oil intermediation, a process that was heavily criticized.
3 and half years passed without the country making spot sales. 2’160,000 barrels of Crudo Oriente were offered.
The presale will be fulfilled
Patricio Larrea reiterated that Ecuador will comply with the pre-sale commitments, but seeks better conditions.
The state subsidy for fuels is maintained
Through social networks yesterday circulated an apparently leaked document of the Ministry of Hydrocarbons in which the elimination of the subsidy to fuel is mentioned, a fact that was denied by the authorities of the sector.
The deputy minister of the State Portfolio, Patricio Larrea, denied any modification to the state subsidies. He assured that it is a falsified document. “The communication system we have among the institutions has been intervened,” stressed Larrea, reiterating that under the mandate of President Lenin Moreno “subsidies are not expected to be removed.”
At the moment the investigations are carried out in order to determine who is behind the falsification. The text that appeared on Twitter dates from January 27, 2018, has as its subject ‘Draft Executive Decree’ and is addressed to Johana Pesántez, legal secretary of the Presidency. The rubric of the person who supposedly issued it is not appreciated. It is even mentioned that it would have been a proposal of the Forum of Economy and Finance hosted by Moreno, after the meeting that took place on January 17. Larrea was emphatic in pointing out that no authority subscribed this document and that the vice-ministry he directs -responsible for these issues- “has never been working in this direction”. At the close of this edition it was expected that the Minister of Hydrocarbons, Carlos Pérez, denounce what happened before the Prosecutor’s Office. (I)
