Ecuador’s Petroamazonas has declared force majeure on the SOTE pipeline after a landslide caused an oil spill, affecting crude exports to Shell Plc. The spill has contaminated the Esmeraldas River, prompting local authorities to declare an environmental emergency.
Petroamazonas, Ecuador’s state oil company, has officially declared force majeure on its Trans-Ecuadorian Pipeline System (SOTE) due to a major oil spill caused by a landslide. This declaration signifies that Petroamazonas may be unable to meet contractual obligations for crude oil exports while they work to manage the spill effectively.
Internal documents reviewed by Bloomberg suggest that this disruption will significantly impact exports to Shell Plc, which was set to receive over 1.8 million barrels of heavy sour Oriente crude this month. Unfortunately, Shell has not yet provided any comments regarding the matter.
The SOTE pipeline, crucial for Ecuador’s oil transportation, possesses a capacity of 360,000 barrels per day and spans 500 kilometers from the Amazon region to the Pacific coast. Petroamazonas is currently addressing the emergency situation regarding the pipeline, though no official estimates of the oil spill’s volume have been disclosed.
The spill has polluted a stretch of the Esmeraldas River in the Esmeraldas province, with local residents in Cube reporting severe water contamination. Media sources indicate that attempts to erect dikes to contain the oil have proven ineffective. Consequently, the Emergency Operations Committee in Esmeraldas has declared an environmental emergency concerning water quality.
Vilko Villacis, the mayor of Esmeraldas, characterized the damage as “unprecedented”. His administration has also suspended the diversion of river water to the city’s aqueduct and has advised residents on water conservation measures. Last year, Ecuador’s oil production stood at 475,000 barrels daily, with 72 percent of this output being dedicated to exports.
In summary, Petroamazonas’s declaration of force majeure following a landslide-induced oil spill represents a significant disruption in oil exports from Ecuador. The impact on Shell’s crude importation, the environmental emergency declared regarding local water quality, and the measures implemented by local authorities highlight the seriousness of the situation. As actions unfold, the priority remains on containing the spill and addressing the environmental damage.
Original Source: www.pipeline-journal.net
