Ecuador Calls Force Majeure on Oil Contracts as Erosion Imperils Pipelines
- Oilfields to stop some production as storage space running out
- It’s the third force majeure since pipes snapped in April 2020
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Ecuador declared force majeure on all oil contracts, including exports and imports, as the threat of soil erosion forced the shutdown of the country’s two pipelines that transport crude across the Andes.
The clause, which is invoked to remove liability from failing to honor contracts in the event of disasters, went into effect on Sunday, according to a statement on the website of state-owned oil producer Petroecuador. The country’s Trans-Ecuadorian Pipeline System and Heavy Crude Pipeline, as well as the Shushufindi-Quito petroleum products pipeline, had to be shut.