QUITO (Reuters) – Oilfield service providers will invest $2.1 billion in Ecuador over the next five years in return for being awarded contracts for 17 blocks and receiving payment for each additional oil barrel produced there, an official said.
State-run company Petroamazonas has reached deals with Schlumberger, Argentina’s YPF and Tecpetrol, China’s Sinopec International, Colombia’s Montecz and Edinpetrol, US firm Halliburton Co, and local companies Sertecpet and Sinopec Services.
The aim of the deal is to increase the proven and probable reserves of the blocks by 171.4 million barrels from their current 277 million, said Oswaldo Madrid, head of the state-run company Petroamazonas.
The blocks produce around 107,000 barrels per day, but are in need of new technology to lift output.
“The operator of the blocks will continue to be Petroamazonas, but the investment risk will be exclusively taken up by the contracted companies,” Madrid said during the contact signing.
Ecuador, OPEC’s smallest member, will pay the service providers a fixed rate per additional barrel produced. Authorities did not reveal the amount.
Halliburton, North America’s top oilfield services provider, said separately on Wednesday it plans to invest around $1 billion in Ecuador during the first five years to enhance oil recovery.