Ecuador is reconsidering a plan to gradually replace its 85-octane Extra gasoline with an ethanol-blended gasoline known as Ecopais, oil minister Carlos Perez told Argus.
After boosting production of Ecopais by 105.8pc to 29.078 b/d in 2017 from a year earlier, state-owned PetroEcuador has halted the plan to distribute Ecopais nationwide.
The blend, which consists of 87-octane gasoline with 5pc of sugar cane-based ethanol, allowed Ecuador to cut sales of Extra gasoline by 52pc since it was launched in 2010. But rising prices for locally produced ethanol have increased the biofuel production costs, and in turn raised a price subsidy for consumers, PetroEcuador chief executive Carlos Tejada told Argus.
According to PetroEcuador internal data, the Ecopais subsidy has climbed by 52.2pc since March 2017 from $0.544 a gallon to a projected $0.828/USG in March this year.
In contrast, the Extra gasoline subsidy grew by 34pc from $0.535/USG to $0.719/USG during the same period. Extra gasoline and Ecopais are sold at the same price: $2.084/USG for industrial activities and $2.016/USG for transportation.
Ecopais is blended at PetroEcuador's Pascuales, La Toma, La Troncal, Chaullabamba and Barbasquillo clean products terminals and at the Esmeraldas and La Libertad refineries.
The biofuel is currently sold in the coastal provinces of Esmeraldas, Santa Elena, Guayas, El Oro and Manabi, in the southern Azuay and Loja provinces as well as the Amazon provinces of Zamora Chinchipe and Morona Santiago.
But it has not reached the north of the country and the highlands, where Ecuador's capital Quito and other major cities are located. The plan to expand distribution to these provinces has been halted for now and "Ecopais has a guarded prognosis," Tejada says.
An ambitious plan to achieve an E10 blend this year has also been put aside because there is still a 300mn l/yr ethanol deficit, which adds further upward pressure on prices, according to PetroEcuador.
