Ecuador's state- owned Petroamazonas, a subsidiary of national oil company Petroecuador that operates oil assets previously owned by Occidental Petroleum Corp., expects to develop oil fields on four oil blocks this year. Reiterating plans announced in February, Petroamazonas General Manager Wilson Pastor said his firm would aim at drilling 14 wells in Panacocha field, with initial production set at 5,000 b/d from the second quarter of 20 1 0, eventually rising to 25,000 b/d.

Pastor said 1 3 wells would be drilled in Panayacu-Qurnde field, with output potential of 10,000 b/d. Four wells will be drilled in Paka Sur field, with initial output of 3,000 b/d possibly online by yearend 2009.

Petroamazonas also hopes to develop Block 3 1 , where it wants to drill 1 4 wells, but financing remains a problem. Pastor said the firm wants to start work on Block 3 1 this year.

Pastor was reiterating plans that had been announced in February following a meeting between Petroamazonas and Ecuadoran President Rafael Correa.

At the time, Cor rea 's office issued a statement saying Petroamazonas would spend up to $820 million to start four projects: Panacocha ($216 million), Panayacu-Quinde ($150 million), Paka Sur ($40 million), and Block 31 ($414 million) .

Correa's office said that Block 3 1 will see the drilling of 14 wells with output scheduled to start in January 2011. Peak production will reach 33,400 b/d.

Budget cut

Prior to Correa 's statement, Ecuador's El Universal newspaper reported that Petroecuador 's budget for 2009 had been ratified at $3.002 billion, a drop of 38% from 2008. It said that Petroamazonas's share would be $967.8 million and that its developmental priorities would include Panacocha and Block 3 1 .

In January, Petroamazonas announced plans to produce an average of 100,600 b/d in 2009, compared with 95,000 b/d in 2008.

Petroamazonas said the production would come from Block 15: 60,400 b/d from Eden-Yuturi field and 40,200 b/d from Indiflana.

To output targets under budgetary constraints, Pastor told Ecuador's El Comercio newspaper in February, Petroamazonas would seek alliances to secure investments.

He said the company needed to invest $509 million in order to meet its output target for 2009, although the government budgeted only $359 million.

Pastor said the outstanding $ 1 5 0 million would be financed through association contracts which would be put out to tender.

For Block 3 1 , formerly operated by Petroleo Brasileiro SA, Pastor said Petroamazonas would consider a joint venture partnership to help with the planned $300 million of needed investment for development.