August 15, 2017 / 10:14 PM / a year ago

UPDATE 2-Ecuador's Esmeraldas refinery in 'critical' situation despite overhaul -minister

(Adds quote, names two companies involved in refinery renovation project)

By Alexandra Valencia

ESMERALDAS, Ecuador, Aug 15 (Reuters) - The situation at Ecuador’s state-run Esmeraldas refinery remains “critical,” including problems with the catalytic cracking unit, despite a $2 billion overhaul meant to modernize the facility, Carlos Perez, the country’s oil minister, said on Tuesday.

The gasoline-producing cat cracking unit is facing “serious problems” and will be closed for 45 days this year for maintenance, the minister told a news conference at the refinery. It was not clear yet when maintenance would begin.

“Although only a short amount of time has elapsed (since the overhaul), we already have problems in the operation of certain areas,” said Perez, referring to the project that ended in late 2015.

“The situation of the facilities of the Esmeraldas refinery is critical,” he said, adding that the authorities would review 10 contracts with foreign and domestic companies involved in the project.

South Korea’s SK Engineering and Construction in 2013 won a $230 million contract to modernize the Esmeraldas refinery that included increasing the capacity of the catalytic cracking unit, according to a statement on SK’s website. The company did not immediately respond to a telephone request for comment.

Australia’s WorleyParsons, which provides engineering design and project delivery services, said in a 2013 statement that it had won a contract to inspect and manage the Esmeraldas refinery revamp.

It did not immediately respond to an emailed request for comment.

Ecuador will still maintain crude output of 541,000 barrels per day, as per the country’s production agreement with OPEC, Perez said. (Reporting by Alexandra Valencia, writing by Hugh Bronstein, editing by Diane Craft and Phil Berlowitz)

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