Ecuador Wants To Finish Talks In 2011 On Oil Contract Terminations

Ecuador expects to conclude negotiations in the second half of the year on the liquidation of contracts of oil companies that left the country after failing to reach

agreement on changing their pacts, the minister of nonrenewable natural resources said.
In January, Ecuador's government concluded almost three years of negotiations aimed at gaining more control over its natural resources and increasing its oil revenue by replacing production-sharing deals with services contracts.
Ecuador changed production-sharing contracts in November held by major foreign oil companies. In January, it changed contracts for smaller, or marginal, oil fields.
Various companies, including Brazil's state-run Petroleo Brasileiro SA (PBR, PETR4.BR), didn't reach agreement with the government and decided to leave the country. The government took over Petrobras operations in Ecuador, and those of small companies that didn't reach agreements.
"Negotiations with Petrobras are the most complex because it claims the largest amount and there are tax and labor problems," Wilson Pastor, the minister of nonrenewable natural resources, told reporters.
According to Pastor, Petrobras has about $160 million in investments, and the company said that a profit margin be taken into account. He said that there are differences of opinion over those profits.
People close to the negotiations told Dow Jones Newswires that Petrobras is asking for about $300 million.
Ecuador has said that it will pay for the assets of companies that failed to reach agreements to change their oil contracts in no more than three years.
Source: Dow Jones