Ecuadorian President Rafael Correa and visiting Venezuelan President Hugo Chavez on Thursday agreed to conduct a joint feasibility study on building giant oil refinery in Ecuador.
The refinery in Ecuador's Pacific coast province of Manabi which is expected to have a daily processing capacity of 300,000 barrels of oil and cost nearly 5 billion U.S. dollars to build.
The two leaders also agreed to boost the strength of Sacha, an oil field in Orellana province, in Ecuador's Amazon region.
Ecuador's state oil company currently produces close to 42,732 barrels a day of 27 degree API oil from Sacha.
At the start of the year, Venezuela agreed to support Ecuador's Esmeraldas refinery and exchange crude oil and refined products.
Chavez arrived in Ecuador on Wednesday night to talk with Correa about energy cooperation and a possible purchase of 500 million dollars of Ecuadorian government's bonds to help it with its debts.
Chavez was cheered by dozens of Ecuadorians in Plaza Grande. "As I have told your president, Venezuela is the home-from-home for all Ecuadorians," Chavez said to the crowd.