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CHINA INVESTS IN ECUADOR
China's largest oil company and its major commercial bank have shown great interest in joining a refinery project of Ecuador-Venezuela which is planned for Ecuador's Pacific coast, claimed a senior minister from the Andean country on Friday.
China National Petroleum Corporation which is the country's top oil producer and Industrial & Commercial Bank of China Ltd, its largest commercial bank by assets, will organize follow-up talks in Quito in the coming month of June on joining the venture.
CNPC and ICBC have signed a letter aiming to join the project and are now carrying off a strategic agreement with the Ecuadorian government, said Glas. He refused to discuss the extent of the potential equity stake or finance. He said that it is a complicated process and will take quite a few months to decide, he stated.
President of Ecuador Rafael Correa said on 22nd April that China is very concerned in financing practically full project, which is at present 51% owned by Ecuador's government run Petroecuador and 49% owned by Venezuela's government run Petroleos de Venezuela.
Ecuadorian President Correa said that China has excess liquidity but scarcity of oil for its consumption, while Ecuador has excess oil but needs liquidity. Therefore he says that the operation is lucrative for both the countries.
In their talks, CNPC and ICBC explored a broad agreement that could bring them into full supply chain for the project, said Glas. He hinted that this could include oil production and taking some of the gasoline and diesel from the refinery.
There are some other countries apart from Venezuela and Ecuador who are showing tremendous interest in rendering crude oil to the refinery. Engineering plans for the refinery will be presented in the coming few months and construction work is scheduled to begin later this year, Correa said.