Ecuador’s Petroecuador declared force majeure on the SOTE pipeline after a landslide caused an oil spill, impacting export commitments, particularly to Shell Plc. The spill contaminated the Esmeraldas River, prompting environmental emergency declarations and significant local concern regarding water quality.
Ecuador’s state oil company, Petroecuador, has declared force majeure on its Trans-Ecuadorian Pipeline System (SOTE) due to a landslide that ruptured the pipeline. This declaration signifies that Petroecuador may struggle to meet contractual obligations for crude oil exports. The company is actively working to contain the resulting oil spill.
Internal documents reviewed by Bloomberg suggest that this disruption could significantly affect exports to Shell Plc, which is expecting at least 1.8 million barrels of heavy sour Oriente crude for loading this month. Shell, headquartered in London, has not yet commented on the situation.
The SOTE serves as Ecuador’s main pipeline system, capable of transporting 360,000 barrels per day over a distance of 500 kilometers (310 miles) from the Amazon region to the Pacific coast. Despite Petroecuador’s efforts to address the emergency, the volume of oil spilled has not been disclosed.
The spill, which has contaminated a portion of the Esmeraldas River, has raised considerable alarm among residents in the town of Cube, who reported severe water pollution. Attempts to construct dikes for containment have proven ineffective.
In response to the situation, the Emergency Operations Committee in Esmeraldas has declared an environmental emergency, focusing on the adverse impact on water quality. Mayor Vilko Villacis characterized the damage as “unprecedented,” and his office temporarily stopped diverting river water to the city’s aqueduct, advising residents to conserve water.
In the previous year, Ecuador produced 475,000 barrels of crude oil daily, with 72 percent of this output being exported.
Ecuador’s Petroecuador has faced a significant crisis following the rupture of the SOTE pipeline, exemplified by the declaration of force majeure. The oil spill has raised environmental concerns and disrupted export commitments, particularly to Shell. The escalation of the situation has warranted a state of emergency regarding water quality in the affected regions, highlighting the potential long-term environmental impacts of the incident.
Original Source: www.pipeline-journal.net
