Ecuador to reject Repsol asset sale to Canadian firm, energy minister says

New Stratus Energy

29/10/2020 15:55

QUITO/NEW YORK, Oct 29 (Reuters) - Ecuador plans to reject
Spanish oil company Repsol's  REP.MC  planned sale of its assets
in the country to Calgary-based New Stratus Energy  NSE.V ,
energy minister Rene Ortiz said on local radio on Thursday. 
    New Stratus had said in a statement last week that it had
signed a letter of intent to acquire Repsol's stake in two
upstream oil blocks in Ecuador, as well as its stake in OCP
Ecuador, which manages the country's heavy crude pipeline. 
    Ortiz said New Stratus did not meet technical and financial
requirements. 
    "Technically this company does not demonstrate that it has
similar or better operations than Repsol," Ortiz told the Vision
radio station. "Financial capacity is needed, which it does not
have." 
    Mario Miranda, chief financial officer for New Stratus, said
the ministry had not yet communicated the decision to the
company. He said New Stratus met all requirements the government
had set, and pledged to respect all environmental and labor
liabilities. 
    "The financial capacity is there," Miranda said by
telephone.
    Repsol did not immediately respond to a request for comment.
    The deal would have involved Repsol's 35% stake in the
service contracts for Blocks 16 and 67, which produced some
16,280 barrels per day (bpd) in September. Contracts for both
blocks expire in December 2022. 
    Repsol also has a 30% stake in the OCP pipeline, which has
the capacity to transport some 450,000 bpd of crude. 

 (Reporting by Alexandra Valencia in Quito and Luc Cohen in New
York
Editing by David Holmes)
 ((luc.cohen@thomsonreuters.com; +58 424 133 7696; Reuters
Messaging: Twitter: @cohenluc))