Wednesday, June 9, 2010

Ecuador hopes to negotiate oil deals before yr-end

* Correa warns of nationalizations if talks fail

* Comments seen as a negotiating ploy
(Adds quotes, details, background)

LIMA, June 9 (Reuters) - Ecuador's leftist President Rafael
Correa said on Wednesday he hopes to finish negotiating new
contracts with oil companies before the end of the year.

The smallest member of OPEC, Ecuador has been trying to
renegotiate contracts with private oil companies for two years
to boost state revenue from the key sector.

"It's been a tough process. We hope to finish the
renegotiation of contracts before the end of December," Correa
said in Lima after meeting Peru's President Alan Garcia.

"If a foreign company refuses to accept the new policies of
the national government ... we'll pay them for their investment
and wish them well," he said.

Correa's comments are widely seen as both a negotiating
tactic in talks with companies and also aimed at bolstering his
image as a nationalist among Ecuadoreans.

The head of Ecuador's hydrocarbons industry association
last month played down fears of takeovers, saying he expected
investment by private companies to almost double to $418
million this year. [ID:nN03209045]

Government officials say they expect to sign the five most
important contracts by mid-November.

Spain's Repsol (REP.MC: Quote), Brazil's Petrobras
(PETR4.SA: Quote)(PBR.N: Quote), Chinese consortium Andes Petroleum and
Italy's Eni (ENI.MI: Quote) are among the biggest oil investors in
the Andean country.

Correa's main regional allies, Venezuelan President Hugo
Chavez and Bolivia's Evo Morales, have also introduced reforms
and nationalized the assets of foreign investors in a bid to
increase state revenue from energy and mining companies.

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