Ecuador Looks To Double Its Oil Production
The oil-dependent South American country Ecuador, which left OPEC in January 2020 to avoid production quotas, has embarked on an ambitious plan to double its oil output. The tiny Andean nation with a population of nearly 18 million has struggled for years to grow its hydrocarbon sector as a means of bolstering a fragile economy that has been hit hard by the COVID-19 pandemic with its 2020 gross domestic product shrinking 7.5%. For decades, Ecuador has struggled to boost oil production with heavy-handed regulation, frequent environmental catastrophes, and endemic corruption weighing heavily on industry operations. After a surprise electoral victory, where millionaire banker Guillermo Lasso defeated leading socialist candidate Andres Arauz, a sense of optimism over the outlook for Ecuador’s beaten-down petroleum industry emerged.
Last month, Lasso signed Executive Decree 95 (Spanish) authorizing various actions to expand Ecuador’s flailing oil industry and bolster production. This forms part of the president’s plan to rebuild Ecuador’s shattered economy by doubling the Andean country’s crude oil output, although he has his work cut out for him. During June 2021 Ecuador pumped on average 473,555 barrels of crude oil per day which was 8% lower than the same period a year earlier and significantly less than the one million barrels per day targeted by Lasso. Ecuador’s petroleum output has essentially been stagnant for decades with its June 2021 production not much higher than the 420,000 barrels per day pumped during 2003.
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