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21-06-2012 20:52:00

Ecuador: Petroecuador, OCP Agree to Connect Pipelines

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QUITO--Ecuador's state-owned oil company, Petroecuador, and private consortium OCP Ecuador SA signed a cooperation agreement Thursday for the interconnection of their respective pipelines.

The first agreement, until 2023, allows the connection between the state-run Sote pipeline and privately held OCP pipeline, the main pipelines in the country, to allow for either Petroecuador or the OCP consortium to use the other's pipeline in the event of an emergency.

Both companies also signed an agreement that provides mechanisms for mutual assistance in emergencies and also in normal situations, with support of staff, facilities and equipment from Petroecuador and OCP. This agreement is for one year but can be renewed until 2023.

The Sote oil pipeline transports about 360,000 barrels a day, while the OCP private pipeline transports about 130,000 barrels of crude oil a day, although it has the capacity to transport about 450,000 barrels a day.

The OCP pipeline will become state property after 20 years of operation in 2023.

OCP's shareholders are Occidental Petroleum Corp. (OXY); Spain's Repsol (REPYY, REP.MC); Brazil's Petroleo Brasileiro SA, or Petrobras, (PBR, PETR3.BR); France's Perenco; Italy's ENI SpA (E, ENI.MI); and China's Andes Petroleum. Andes Petroleum's stake is held by China National Petroleum Corp. and Sinopec Overseas Oil & Gas Ltd.

Write to Mercedes Alvaro at mercedes.alvaro@dowjones.com

(END) Dow Jones Newswires

June 21, 2012 14:52 ET (18:52 GMT)

Copyright (c) 2012 Dow Jones & Company, Inc.

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