Ecuador has successfully renegotiated an agreement with ENAP SIPEC, a subsidiary of Chile’s state-owned oil company ENAP, for the continued exploitation of an oil block in the Ecuadorian Amazon. This new agreement, finalized on July 15, includes an additional investment of $90 million, with plans to extend operations until 2035. The Ministry of Energy in Quito announced that this deal is expected to increase Ecuador’s crude oil reserves by 5.6 million barrels.
Energy and Mine Minister Antonio Goncalves highlighted that the majority of this investment—98 percent—will be executed within the first five years following the signing of the agreement. This accelerated investment schedule aims to boost production and optimize the exploitation of resources in the region. ENAP SIPEC, which already operates the oil block, is set to play a pivotal role in this enhancement.
ENAP’s involvement in Ecuador dates back to 2010 when the company signed a service contract to operate three oil blocks in the country. One of these, Block 46, located in the Orellana province in the northeast, had its agreement renegotiated earlier in 2021. This block currently produces 16,700 barrels per day (bpd), contributing significantly to ENAP’s overall production in Ecuador, which stood at 28,443 bpd as of mid-July 2024.
The additional investment and the revised terms of the agreement are poised to bolster Ecuador’s oil production capabilities, reinforcing its position in the regional energy market. By focusing on increasing reserves and optimizing extraction processes, Ecuador aims to secure more sustainable and profitable exploitation of its natural resources. This strategic move underscores the importance of international partnerships and targeted investments in driving economic growth and energy sector development in Ecuador.
