The project is worth US$3.5 billion and will be developed by a private American company.
A new high conversion refinery is planned to be built in the province of Santa Elena. The project will be carried out by a private company and is part of the Government's ambitious plan to attract around US$ 42 billion in investments for the hydrocarbon sector by 2029.
The government has made progress in talks with the US firm DRL Houston, which is interested in the plant, announced the Vice Minister of Hydrocarbons, Guillermo Ferreira, during the presentation of the investment plan on January 22.
According to official information, the total investment in the project would reach US$ 3.5 billion and it would have a processing capacity of 80,000 barrels per day. The plant will work with Oriente and Napo crude oils. It will produce gasoline and diesel with Euro 5 category.
Santiago Quisirumbay, Undersecretary of Refining, Industrialization, Transportation and Commercialization of Hydrocarbons, indicated that the aim is to achieve a policy of improving the quality of fuels, which goes hand in hand with improving infrastructure.
With this objective, the high conversion refinery project that was proposed in 2020 (during the government of Lenín Moreno) was reformulated.
He explained that DRL Houston is currently in the process of obtaining a permit to carry out refining and industrialization activities, which is expected to be completed in September of this year. The company will then apply for a permit to build and operate the new refinery.
"This is a new technology," the undersecretary explained, adding that in a second phase of the project, its processing capacity is expected to increase by another 80,000 barrels.
The construction of the refinery would generate around 5,000 jobs, 1,000 permanent during the operation phase and 1,000 additional jobs through operation and maintenance contracts.
The Vice Minister of Hydrocarbons clarified that national legislation allows the country to have private refinery capacity. “They (the private company) make all the investment, all the construction contract, and put it into operation,” said Ferreira, explaining that the construction of the plant would take approximately four years.
The company expressed its interest about seven months ago. In talks with investors, it was agreed that Petroecuador will have priority in supplying the refinery with the crude oil it requires. The oil will be sold directly, without intermediaries, and at the WTI (West Texas Intermediate) price, Ferreira said.
Likewise, he said, Ecuador will have priority in acquiring the fuels produced by the new refinery.
For now, the signing of a memorandum of understanding with Petroecuador is expected, to establish the priority of sale and purchase. In addition, the company is in the process of obtaining the construction permit from the Hydrocarbon Regulation and Control Agency (ARCH). Between August and September, it is estimated that “everything will be closed” with the investors.
Asked when construction of the infrastructure would begin, Ferreira replied: “At that time.”
