Petroecuador has declared force majeure on the SOTE pipeline due to an oil spill caused by a landslide. The incident threatens the company’s export commitments and has led to environmental concerns in Esmeraldas province, prompting local authorities to declare an emergency. Mayor Vilko Villacis described the damage as unprecedented, while the ecological impact raises immediate concerns for water quality.
Petroecuador, Ecuador’s state oil company, declared a force majeure on the Trans-Ecuadorian Pipeline System (SOTE) following a significant oil spill resulting from a landslide that ruptured the pipeline. This status, announced on Tuesday, indicates that Petroecuador may not be able to meet its contractual obligations for crude oil exports while it works to manage the spill.
Internal documents reviewed by Bloomberg suggest that the disruption is likely to impact exports intended for Shell Plc, which had contracted for approximately 1.8 million barrels of heavy sour Oriente crude during this month. Shell, headquartered in London, has yet to comment on this development.
The SOTE is Ecuador’s primary oil pipeline system, boasting a capacity of 360,000 barrels per day. It facilitates the transportation of oil over a distance of 500 kilometers (310 miles) from the Amazon region to the Pacific coast. Petroecuador reported on Friday that it is actively addressing the emergency, but did not disclose the estimated volume of oil that has been spilled.
The spill, attributed to the landslide, has polluted a section of the Esmeraldas River in Esmeraldas province. Residents in the town of Cube have reported significant contamination of the river’s water, with some attempting to construct dikes to contain the oil spill, albeit with limited success.
In response to the environmental impact, the Emergency Operations Committee of Esmeraldas declared an environmental emergency, focused on concerns regarding the quality of water in the region. Mayor Vilko Villacis characterized the damage as “unprecedented,” and his office has suspended the diversion of river water to the city’s aqueduct while advising residents to conserve water.
Last year, Ecuador had a crude oil production of 475,000 barrels per day, exporting 72% of that volume, demonstrating the significance of oil exports to the country’s economy.
In summary, Petroecuador’s declaration of force majeure on the SOTE pipeline follows a serious oil spill caused by a landslide, hindering the company’s ability to fulfill export commitments. The contamination has led to significant environmental concerns, prompting local authorities to declare an emergency. As a critical exporter of crude oil, the incident poses challenges not only for Petroecuador but also for international buyers like Shell, heightening the urgency for effective containment and remediation efforts.
Original Source: www.pipeline-journal.net
