Government seeks significant oil output boost amid ITT closure and new gas import strategies.
The Ecuadorian government, led by President Daniel Noboa, has unveiled a bold initiative to ramp up oil production by 105,000 barrels per day (bpd) by 2025, increasing from 475,272 bpd in 2024 to 580,000 bpd next year and aiming for 600,000 bpd in 2026. To support this growth, the government plans to secure $42 billion in investments through 2029.
Interim Energy Minister Inés Manzano outlined these targets at an investor meeting in Quito on January 22, 2025, emphasizing the need to reverse years of stagnant production. Official data shows production in 2024 barely exceeded 2023 levels, with plans to gradually rise in the next two years before tapering off post-2026.
However, challenges loom. The closure of the ITT oil field in Yasuní National Park, following a national referendum, will reduce production by 10,000 bpd in 2024 and another 15,000 bpd in 2025, according to Vice Minister of Hydrocarbons Guillermo Ferreira.
ITT Field Closure and Long-Term Impact
Located in the biodiverse Yasuní National Park, the ITT oil block has begun a phased closure as mandated by the public vote. Authorities have outlined a detailed plan to shut down all 246 oil wells by 2029. In 2024, 10 wells were closed, with 48 scheduled for decommissioning annually through 2028.
This progressive shutdown will significantly impact production. By 2028, Ecuador’s oil output is expected to decline to 395,544 bpd, down from its projected peak of 600,720 bpd in 2026.
Investment Projects and Upcoming Bids
To offset losses, the government is pursuing several energy projects:
- Intra Campos Oil Round: On February 25, 2025, bids will be received for three oil blocks, with interest from 14 companies.
- Amistad Gas Field Delegation: Scheduled for March 2025, this aims to transfer natural gas operations to private firms.
- Offshore Gas Exploration: The government plans to auction rights for gas exploration in the Gulf of Guayaquil, Esmeraldas, and Manabí, with bids expected in March 2025.
Gas Imports to Meet Demand
While awaiting the results of these initiatives, the Noboa administration is preparing to import natural gas to maintain electricity generation and support new projects. Vice Minister Ferreira highlighted the urgency, noting that the Termogas Machala thermoelectric plant is already operating at capacity with its current gas supply.
Potential import strategies include:
- Importing 40 million cubic feet of gas from Peru’s Albacora platform.
- Installing a floating reception, storage, and regasification unit in Puerto Bolívar with a pipeline to Termogas Machala.
- Developing a storage vessel and regasification unit with a pipeline from Puna Island to Termogas Machala.
- Establishing a floating regasification plant with an offshore terminal for vessel reception.
With plans to deploy 400 megawatts of combined-cycle thermal generation, Ecuador’s demand for gas will surge, making these measures critical.
Balancing Growth and Conservation
As Ecuador navigates the delicate balance between boosting oil output and adhering to environmental commitments, the success of its ambitious energy projects will be closely watched. The stakes are high for a country striving to meet economic goals while addressing the demands of biodiversity preservation.
I find it interesting that some Ecuadorians are so obsessed with O&G development being harmful to the environment while turning a blind eye to the tons of garbage being recklessly tossed into the lakes, rivers & ocean in this country!
I have wondered the same things. I pick up plastic garbage everyday by the river and it’s a drop in the bucket. I see people dumping garbage by the big bagfuls. So frustrating
You are really comparing littering with the contamination of our Amazon? Where not only all the communities that lived there are going to be displaced but also millions of animal species may die.
Who is turning the blind eye?
loan from where CHINA thats where
This all sounds great on paper, but what about the electricity problem? They are already saying because of the lack of attention from anyone in the government, the blackouts will return by April. So, it was all smoke and mirrors from Noboa, stopping the blackouts for the campaign, and then resuming them once he is confirmed as president again.