Ecuador’s Petroecuador Declares Force Majeure on SOTE Pipeline After Major Oil Spill

Ecuador's state oil company, Petroecuador, declared force majeure on its Trans-Ecuadorian Pipeline System (SOTE) following a landslide that ruptured the pipeline and caused an oil spill, the company said in a statement.
The force majeure, declared Tuesday, means Petroecuador may not be able to fulfill contractual commitments to export crude. The company is working to contain the spill.
Internal documents seen by Bloomberg indicate the disruption is expected to reduce exports to Shell Plc, which had purchased at least 1.8 million barrels of heavy sour Oriente crude loading this month. Shell, based in London, did not immediately respond to a request for comment.
The SOTE, Ecuador's primary pipeline system, has a capacity of 360,000 barrels per day, transporting oil 500 kilometers (310 miles) from the Amazon to the Pacific coast.
Petroecuador said Friday it was addressing the emergency at the pipeline, part of the SOTE system following the spill, but did not release an estimate of the volume of oil spilled.
The spill, believed to have been caused by a landslide, contaminated a section of the Esmeraldas River in Esmeraldas province, with residents in the town of Cube reporting significant pollution of the river's water. According to media reports, they attempted to build dikes to contain the oil, but that didn’t offer much help.
The Emergency Operations Committee in the provincial capital of Esmeraldas declared an environmental emergency due to concerns about water quality.
Vilko Villacis, mayor of Esmeraldas, a city of more than 200,000, described the damage as "unprecedented." His office halted the diversion of river water to the city's aqueduct and urged residents to ration water.
Ecuador produced 475,000 barrels of crude per day last year, exporting 72 percent of that total.