PETROECUADOR PRESIDENT RESIGNS OVER CASH CRISIS

Petroecuador president Luis Roman resigned after a long dispute with the Ministry of Economy and Finance triggered by the state-owned oil operator's growing cash deficit.

- Large fuel subsidies for the domestic market, combined with high international market prices and the company's limited financial autonomy, have caused Petroecuador's cash deficit to soar to US$150 million, rendering the company unable to pay salaries and contractor fees.
- The dispute is linked with Ecuador's social unrest, with a number of protests demanding greater government participation and contract renegotiations for private oil operators. The protests also resulted in production disruptions along the Trans-Ecuadorian Oil Pipeline System after one month of normal production levels.
- A revision of production-sharing agreements has officially begun by a government committee which will present a plan for adjustments in payments to the government from private operators. The adjustments will be made retroactive to 2000.

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