August 25, 2017 / 7:51 PM / 4 months ago

Ecuador commissions audit of oil sector projects

QUITO, Aug 25 (Reuters) - Ecuador is commissioning a foreign auditing firm to review the technical and financial terms of five key oil sector projects that have shown serious operational failures despite heavy investments, the ministry of hydrocarbons said on Friday.

Among the projects to be audited is the 110,000 barrels-per-day Esmeraldas refinery, which is facing significant operational problems less than two years after a $2 billion overhaul meant to modernize the facility.

“An international, specialized auditing firm will review the technical and financial terms of the five projects,” the ministry said in a statement, which did not identify a firm.

Other projects to be reviewed include a natural gas liquefaction plant and initial work on a new refinery called the Refinery of the Pacific, which is expected to require international financing to complete its construction.

The overhaul of the Esmeraldas Refinery included a total change of the fluid catalytic cracking unit, which has been halted for 16 days so far this year, according to data from the ministry of hydrocarbons.

Problems are also evident at the refinery’s crude units 1 and 2, storage systems and power generation facility.

Other projects show flaws related to construction and deterioration of equipment, according to an official report.

The five projects together required public investment of about $5 billion and were carried out under the government of former President Rafael Correa. (Reporting by Alexandra Valencia, writing by Brian Ellsworth; Editing by Marguerita Choy)

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