Ecuadorian Energy Minister Galo Chiriboga said on Tuesday the Organization of Petroleum Exporting Countries (OPEC) had accepted Ecuador back as an active member following fifteen years of absence.
Chiriboga added that Ecuador and OPEC agreed on a three-year payment plan for the dues owed by the re-incorporated member which total 5.7 million US dollars. Ecuador stopped paying OPEC membership fees in 1992, although it never formally left the organization "We will do all that is required to be present at the next meeting in Saudi Arabia in November," he added. "Ecuador will return to OPEC, which it left in 1992, to help strengthen the organization and to receive advise from other nations in oil matters," he added. Ecuador returns to the cartel as it is renegotiating contracts with overseas oil companies, following a change in policy that gives the state 99% of so-called (windfall) excess oil profits, generated on the increase in international oil prices. The controversial decision affects profits from Brazil's Petrobras, China's Andes Petroleum, Spain's Repsol-YPF, the United States' City Oriente, and France's Perenco. President Rafael Correa said two weeks ago that returning to OPEC was an important step for Ecuador because it will enable South America's fifth largest producer (507.000 bpd) access to better market information and technical advice. "OPEC will help us with its experience in the renegotiation of contracts with private oil companies," he said. In related news crude prices dropped on Tuesday on the news that OPEC has increased output ahead of its previously announced 500,000 bpd hike, which was scheduled to begin on 1 November. In addition, there was some relief in the dispute between Turkey and Kurdish-controlled northern Iraq, a region that is home to a significant amount of oil production. December contracts for West Texas Intermediate dropped 75 cents to $85.27 per barrel on the New York Mercantile Exchange, while Brent crude fell 42 cents to $82.85 per barrel on the ICE Futures Europe exchange in London.