Nation's primary oil and gas producer acquires a 30% stake in refinery project

China National Petroleum Corp, the nation's largest oil and gas producer, will take a 30 percent stake in a refinery project in Ecuador, Jorge Glas, the South American country's vice-president, said on Wednesday.

CNPC, also known as PetroChina, will invest more than $10 billion to help finance the Pacifico oil refinery project, Glas said during an economic forum in Beijing.

He added that the construction of the project's first phase has already been completed.

A cooperation contract will be signed later this year, Glas said after paying a visit to CNPC headquarters on Tuesday.

He held talks with Zhou Jiping, CNPC's chairman, and Wang Dongjin, the company's vice-president, on a number of issues such as financing, taxation, a feasibility report and project management, as well as expanding upstream cooperation.

"With the support of Ecuador's government, the agreement will come into force as soon as possible, and the cooperation project between the two sides in the upstream sector will be expanded," Zhou said in a statement.

Glas noted that the project is "one of the biggest investments" in Ecuador and will eventually plays a huge role in promoting the country's economic development.

He added that Ecuador looks forward to having more opportunities to cooperate with PetroChina, the world's second-largest oil company in terms of oil and gas production, which already owns four oil and gas blocks in the South American nation.

The Pacifico refinery, which is being built in Manabi province, is a joint venture between Ecuador's state-owned oil company PetroEcuador and Venezuela's state oil company Petroleos de Venezuela.

After the deal with CNPC, the two companies will continue to participate in the project.

Ecuador had been looking for a third partner for the refinery and had been in talks with China for a year to finance the project, which is estimated to cost nearly $12 billion.

Reuters reported earlier that the refinery project is intended to cut domestic fuel costs for Ecuador, the smallest member of the Organization of Petroleum Exporting Countries, which pumps 500,000 barrels of crude a day but imports oil products because of its low refining capacity.

Ecuador has said it wants to complete construction of the Pacifico refinery in 2016.

After excluding itself from debt markets by defaulting on $3.2 billion in global bonds in 2008, Ecuador's government is doing its best to solve funding problems and is urging the signing of agreements to boost cooperation projects in the oil sector.

A group of Chinese banks headed by Industrial and Commercial Bank of China will be in charge of the financing of CNPC's participation in the project.