PetroEcuador shuts pipeline, halts exports: Update

Adds force majeure declaration, other details.

State-owned PetroEcuador declared force majeure on oil exports and suspended operations on its 360,000 b/d SOTE crude pipeline in response to ongoing violent protests that have slashed production.

According to Ecuadorean regulatory data, total national production dropped to 306,000 b/d yesterday, compared with 426,000 b/d the day before, and 545,000 b/d on 1 October. At least three oil fields have been shut in by state-owned PetroAmazonas as a result of the social upheaval.

Buyers of Ecuadorean medium sour Oriente and heavy sour Napo crude grades were informed today of an indefinite force majeure declaration on international oil transactions.

In PetroEcuador's latest spot crude tenders awarded early last month, Repsol was awarded 1.08mn bl of Napo supply and China's Unipec won 3.6mn bl of Oriente. The first shipment of Oriente for Unipec had been scheduled to load on 16-18 October.

The unrest broke out on 4 October after the government of President Lenin Moreno lifted fuel subsidies. Since then, the government has dispatched the military to protect key government buildings and oil infrastructure from further attacks. Among the targets of the protesters has been the National Assembly.

The turmoil forced Moreno and key cabinet members to move temporarily to the coastal city of Guayaquil from the capital Quito. Moreno would return to Quito today to monitor the situation, interior minister Maria Paula Romo said.

The government blames former president Rafael Correa and Venezuelan president Nicolas Maduro for instigating the unrest with the goal of toppling him. Vice president Otto Sonnenholzner said today that "dozens" of Venezuelans are among more than 700 detainees so far.

The government scrapped the fuel subsidies as part of an austerity package coordinated with the International Monetary Fund (IMF).

Maduro and Correa have denounced the austerity measures and the Moreno government. Correa governed Ecuador for a decade until Moreno started his term in 2017.

The 498km SOTE pipeline stretches from the Lago Agrio storage and pumping station in the northern Amazon oil district to the Balao Pacific port in Esmeraldas province.