QUITO, Sept 29 (Reuters) - A Noble Group subsidiary will provide a $1 billion credit line to Petroecuador, Ecuador’s state oil company, and in return, the country will buy a certain amount of the Hong Kong-based company’s refined oil products, the government said on Monday.
Petroecuador is increasingly going to the open market for finished fuels since its largest refinery started a 14-month overhaul in July.
Its 110,000 barrel-per-day Esmeraldas refinery will cease operations completely between October and November for renovations, further bolstering the need for imports.
Ecuador did not say how much diesel and gasoline it would be required to buy from the company’s Noble Americas subsidiary.
Local media said the purchases would likely meet around 55 percent of the country’s annual demand for derived oil products.
Ecuador imported roughly $4.9 billion in diesel and high-octane naphtha last year, according to the central bank.
Noble Americas extended a credit line “at a 6 percent (interest) rate for a five-year period,” said Madeleine Abarca, Ecuador’s vice minister of finances.
The funds will be used to finance Ecuador’s oil industry. The country is Latin America’s sixth-largest crude producer and the smallest member of OPEC. (Reporting by Alexandra Valencia; Writing by Alexandra Ulmer; Editing by Steve Orlofsky)