Ecuador buries oil pipelines in volcano path

Market: Crude oil, Oil products
16/10/15

Ecuador's state-owned PetroEcuador is burying several sections of the 360,000 b/d Sote crude pipeline and the 12,300 b/d Quito-Ambato-Riobamba refined products pipeline to protect them from a potential eruption of the Cotopaxi volcano.

Small explosions and a steady stream of ash plumes began in August at the snow-capped 5,897m (19,347ft) volcano, located 50km (31mi) south of Quito.

An eruption threatens to trigger massive floodwaters and mudslides that could reach the coastal region in a worst-case scenario.

PetroEcuador has so far buried 8km of the 503km Sote, which transports mainly 28°API Oriente crude from Ecuador's oil district in the Amazon to the Pacific port of Balao in Esmeraldas province.

The goal is to bury a 17km section near the San Pedro river in Cotopaxi's immediate path, a PetroEcuador official told Argus.

PetroEcuador already buried 17km of the 6'' Quito-Ambato-Riobamba products pipeline and is opening two paths under the Cutuchi river to protect the infrastructure from floodwaters. The line transports gasoline and premium diesel from the El Beaterio products terminal in Quito to the highland cities of Ambato and Riobamba.

PetroEcuador is also monitoring the 305km 9,500 b/d Shushufindi-Quito pipeline that transports low octane gasoline and LPG from the 20,000 b/d Shushufindi (Amazonas) refinery to El Beaterio.

On 14 August, President Rafael Correa declared a 60-day state of emergency, paving the way for the mobilization of security forces and release of extraordinary government funds.

The melting Cotopaxi snow could overflow rivers, including Cutuchi, San Pedro, Pastaza and Guayllabamba, where the new 60MW Manduriacu hydroelectric plant is located.

Ecuador's deputy electricity minister Medardo Cadena has ruled out a potential risk of destruction of the Manduriacu and the 156MW Agoyan hydroelectric complex that take waters from the Pastaza river.

In 1877 when the last massive eruption of the Cotopaxi took place, mudflows traveled some 225km from Ecuador's highlands to coastal provinces. The debris flowed through several secondary rivers to reach the Guayllabamba basin, according to historical records.

Ecuador's state-owned utility Celec is taking measures to protect power transmission infrastructure that could be damaged by ash plumes, and the Mulalo substation, considered vulnerable to mudflows.

Celec says it has deployed equipment to remove ash from the 138kV Mulalo-Vicentina transmission line and has installed two mobile substations in the event of potential shortfalls and damages at Mulalo.

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Furthermore, vessel operators that cancel within two days of their transit will be charged a fee at 2.5 times the transit reservation fee, described by the ACP as a surcharge to the existing cancellation fee, which ranges up to 100pc of the transit reservation fee depending on how close to the transit date that an operator cancels. This means that a Super vessel that cancels within two days of its transit date will receive the 2.5 times surcharge on top of the 100pc transit reservation cancellation fee and pay a total of $175,000. A Neopanamax vessel will pay a total of $350,000. "Vessels of war" should also vie for slots: ACP Trump also suggested that the ACP was charging the US Navy, alongside US corporations, "exorbitant prices and rates of passage" and that these fees were "unfair and injudicious". In March 2024, the ACP published an update on transit slot assignments for vessels of war, auxiliary vessels and other "government-owned" vessels encouraging their operators to participate in the transit system rather than waiting for the ACP to assign them a slot. "Vessels of war, auxiliary vessels, and other government-owned vessels are encouraged to obtain a booking slot through the available booking mechanisms in order to have their transit date guaranteed and minimize the possibility of delays," the ACP said. The ACP points out that these vessels of war are entitled to "expeditious transits" based on the Treaty Concerning Permanent Neutrality and Operation of the Canal and are technically not required to obtain a reservation to be considered for transit. Panama president Jose Raul Mulino on Sunday rejected Trump's threat to retake the canal , which has been under full control of the Central American country since 1999. The canal's rates are established in a public and transparent manner, taking into account market conditions, Mulino said. "Every square meter of the Panama Canal and its adjacent area is Panama's and will continue to be," Mulino said. "The sovereignty and independence of our country are non-negotiable." By Ross Griffith Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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