QUITO, Ecuador (Dow Jones)
Ecuadorean President Rafael Correa said Saturday China could fully finance the $13 billion Refineria del Pacifico, a joint project between Ecuador and Venezuela's state oil companies.
"China is very interested in financing practically all," Correa said during his weekly media address.
According to Correa, China has a surplus in liquidity but a shortage in oil for its consumption, while Ecuador has surplus in oil but needs liquidity, so the operation is attractive for both parties. Correa didn't provide any detail.
Refineria del Pacifico, a refining and petrochemical complex, will be 51% owned by Ecuador's state-run Petroecuador and 49% owned by Venezuela's state-run Petroleos de Venezuela, or PdVSA.
Correa also said his Minister Coordinator of Strategic Sectors, Jorge Glas, has traveled to China to negotiate the financing.
Last month Jorge Glas told Dow Jones Newswires that Ecuador and the Industrial & Commercial Bank of China Ltd. (IDCBY, 6012398.SH) have signed a letter of intention that outlines the bank's interest in providing financing and Ecuador's interest in receiving it.
Glas also said that Chinese companies China National Petroleum Corp (CNPC.YY), or CNPC, and China Petroleum & Chemical Corporation, or Sinopec Corp.(600028.SH) are interested in partnering in the project.
Refineria del Pacifico will include a refinery to process 300,000 barrels of oil per day, a basic petrochemical plant to produce benzene, xylene and polypropylene as well as on- and offshore marine facilities.
Correa said Refineria del Pacifico, located in the coastal province of Manabi, is scheduled to go on line in 2016.
China has become an increasingly important source of funding for Ecuador.
Ecuador's 2008 default on $3.2 billion of government bonds cut off access to private capital market lenders overseas, but China stepped up to become the Andean nation's top creditor, lending billions of dollars to Ecuador in exchange for future provisions of oil.
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