The resources obtained will be to complete the budget and comply with the economic plan.
In order to obtain financing from two Chinese banks, the government negotiates two long-term oil sales, for a total of 154 million barrels.
Of that amount, 142.5 million barrels correspond to new production and the rest to a remainder of a contract with China that will be settled and included in the new operations.
With these actions, the State seeks to obtain USD 2.4 billion that would come from the Industrial and Commercial Bank of China (ICBC) and the China Development Bank (CDB).
Previously, the Ministry of Economy indicated that only part of this financing would be conditional on the delivery of crude and the rest would be through credit operations.
In May, then Minister Richard Martínez commented that the interest rate on these loans would be approximately 6%.
In addition, he indicated that the first USD 1.7 billion were expected to be received in 2020. The rest would be obtained in 2021. However, these operations are still under negotiation.
Petroecuador, in charge of the commercialization of crude oil, analyzes the sale of 70 million barrels of oil until 2025, in exchange for a loan of USD 1,400 million, which would be granted by the ICBC.
To this operation is added another with the CDB, which would deliver USD 1 billion. This loan is tied to a crude oil sale operation of 84 million barrels.
According to Finance, these latest deliveries are scheduled until 2028.
This reality has put the state oil company in an uncomfortable situation because the Chinese companies would pay USD 2 less per barrel in relation to the last long-term sale to the private firm Shell and there would not be enough crude to assume new commitments.
In addition, it is estimated that by 2021 the country will have a deficit of 10.2 million barrels of crude from its exportable supply and it is expected that in 2022 that trend will continue to decline.
This year, around 67,000 barrels per day have not been exploited compared to 2019. Given this, the Vice Ministry of Hydrocarbons recommended that Petroecuador, in October, suspend spot or immediate sales until 2022.
With this scenario, the Comptroller’s Office suggested that at least 10% of the exportable oil supply be traded on the spot market, in order to know how much the market is willing to pay for Ecuadorian crude.
While the Minister of Economy, Mauricio Pozo, stated yesterday that the resources expected to be obtained from China are part of the budget for this year and will allow the completion of the economic program.
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