QUITO – Ecuador has authorized an environmental permit for Brazil’s Petrobras to develop the Block 31 oilfield in the Amazon region, which should start production in 2009, President Rafael Correa said on Tuesday.
The clearing of the environmental license was the last stage in the project, which is vital for Ecuador to increase its petroleum production, but which faced opposition from environmental groups worried about damage in the Amazon.
Petrobras (PETR4.SA: Quote, Profile, Research) in December was authorized to resubmit its environmental proposal to address concerns. The Brazilian company expects to invest $300 million in the field to produce around 40,000 barrels per day in crude.
“The environmental license has been given to Petrobras …. It has been signed,” Correa told reporters.
The field should produce crude between API 16 to API 19.
The block could boost to crude output in South America’s No. 5 oil producer, whose daily flow has dropped in recent years because of scarce investment and strikes and protests in the crude-rich Amazon region.
The Amazon block is located in Ecuador’s Yasuni national park, where indigenous groups isolated from modern society live alongside rare wildlife. Development has been delayed by pressure from ecologists and influential Indian groups.
