Ecuador Oil

Ecuador Oil located in the surface of the Rainforest, is not only intended to meet local demand but is intended for export overseas.

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Beneath the surface in the Amazon Rainforest of this country, are large amounts of oil not brought to the surface yet.

Fifty percent of Ecuador's national budget is funded by oilearnings and continued oil exploration and production is thoughtto be necessary to ensure the countries' well being.

The country plans to increase production and holds auctions to increase foreign investment.

Dependence on oil revenue has hindered Ecuador's environmental enforcement, which in turn has caused damaging consequences to indigenous tribes living in the Amazon Rainforest region and to the environment in the eastern part of the country.

Much of Ecuador oil, lies beneath remote areas of the Amazon rainforest.

Now the indigenous people of the region are starting to organize themselves politically in a bid to keep the oil industries out of their ancestral homes.

In global oil terms, Ecuador is a relatively small player. But revenues from its existing Amazon oil reserves are critical in keeping the country's economy afloat.

Now, with the country sitting on huge potential new reserves, there is enormous pressure to expand production.

One reason that there is such bitter opposition to Ecuador oil plans is that the country's original Amazon oilfields have left a legacy of deforestation and environmental damage.

Chevron-Texaco Disaster

The American company Texaco (that operated in Ecuador's biologically rich Amazon Rainforest from 1967 through 1992) first discovered oil in Ecuador 40 years ago.

Indians say oil companies harm both the environment and society.

Now, almost 15 years since it pulled out of the country, the company, which has become Chevron Texaco, is facing a multi-billion-dollar lawsuit there.

The company is on trial, accused of using outdated technology which contaminated the soil and water systems, causing widespread health problems.

Texaco stands accused of dumping more than 18 billion gallons of toxic waste into Rainforest waterways over a 26 year period. More than 30,000 local people were affected.

But whatever the outcome of the case, those in the southern Amazon basin are understandably reluctant to let oil companies in.

Ecuador is one of Latin America's largest oil exporters, with net oil exports estimated at 305,000 barrels per day (bbl/d) in 2009.

Ecuador oil sector accounts for about 50% of the country's export earnings and about 1/3 of all tax revenues.

Despite being an oil exporter, Ecuador must still import refined petroleum products due to the lack of sufficient domestic refining capacity to meet local demand.

As a result, the country does not always enjoy the full benefits of high world oil prices: while these high prices bring Ecuador greater export revenues, they also increase the country's refined product import bill.

The country's energy mix is largely dependent upon Ecuador oil, which represented close to 80% of the country's total energy consumption in 2007.

Hydroelectric power represented 19% of total energy consumption in 2007, and accounts for about half of all generated electricity.

Natural gas consumption is minimal, due to the lack of domestic infrastructure to transport, distribute and utilize the fuel.

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Keeping Ecuador Oil Underground

Yasuni National Park in Ecuador is home to one of the richest concentrations of plant and animal species on the planet.

More tree species grow in a single hectare of Yasuni than in all of North America and the reserve hosts an indigenous group still living in isolation.

Now the United Nations Development Program has set up a fund to pay the government of Ecuador to keep Yasuni unspoiled by leaving as much 850 million barrels of Ecuador oil under the park's ground.

At $80 per barrel that's nearly $70 billion worth. And roughly 400 million metric tons of CO2 that wouldn't enter the atmosphere.

Ecuador wants in return is $3.6 billion over the next decade for a pledge never to develop the Ecuador oil field.

Countries that paid into the UNDP fund would receive a credit for the avoided greenhouse gas emissions, potentially offsetting some of their own oil burning.

Germany has committed to pay some $50 million per year over the next 12 years. Other commitments remain sparse on the ground despite the plan having been floated since 2007.

Despite its small area, Ecuador is the eighth most biodiverse country on Earth.

It has almost 20,000 species of plants, over 1,500 species of birds, more than 840 species of reptiles and amphibians, and 341 species of mammals.

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