Sinopec Wins $105M Petroecuador Contract for Amazon Drilling Campaign Targeting 12,000 bpd Across Orellana and Sucumbios

Sinopec Wins $105M Petroecuador Drilling Contract in the Amazon

Petroecuador awarded a $105 million drilling services contract to Sinopec International Petroleum Service Corporation, a subsidiary of China Petroleum & Chemical Corporation (Sinopec Group), for an intensive drilling campaign across the Ecuadorian Amazon. The contract, approved by Petroecuador's board in January 2026, calls for six simultaneous drilling rigs operating in Orellana and Sucumbios provinces with a target of adding 12,000 barrels per day (bpd) of incremental crude oil production.

The programme is expected to create approximately 2,500 local jobs during the 18-month operational phase, with Sinopec required to source at least 60% of field labour from communities in the two provinces.

Contract structure

Key terms of the drilling services agreement:

Parameter	Detail
Contract value	$105 million
Duration	18 months (with 6-month extension option)
Rigs deployed	6 simultaneous
Target production	12,000 bpd incremental
Provinces	Orellana, Sucumbios
Local employment	2,500 jobs (60% local content)
Contract type	Drilling services (not production-sharing)

The contract is structured as a pure services agreement -- Sinopec provides drilling rigs, technical personnel, and operational management, while Petroecuador retains 100% ownership of all hydrocarbons produced. This distinguishes it from the more commercially significant production-sharing contracts that govern larger field developments.

Separate from the Sacha mega-project

The $105 million drilling contract is distinct from Sinopec's much larger involvement in Ecuador's oil sector through the Block 60 (Sacha field) production-sharing contract, which represents the single largest upstream investment in the country:

Project	Contract Type	Investment	Sinopec Stake	Target Peak Output
Sacha Field (Block 60)	Production-sharing	$1.7 billion	60% (Petrolia 40%)	100,000 bpd by 2028
Amazon Drilling Campaign	Services contract	$105 million	Contractor only	12,000 bpd

The Sacha field, located in Orellana province, is Ecuador's largest producing asset and has been in continuous operation since 1972. The production-sharing contract, awarded in 2024, aims to reverse decades of declining output through enhanced oil recovery techniques and infill drilling, with a peak production target of 100,000 bpd by 2028.

National production context

Ecuador's oil sector faces a widening gap between production targets and actual output:

Year	Government Target (bpd)	Actual/Estimated Output (bpd)	Gap
2024	500,000	~365,000	-135,000
2025	550,000	~349,000	-201,000
2026 target	600,000	TBD	--

Current national production has fallen to approximately 349,000 bpd, well below the government's 600,000 bpd target for 2026. The decline reflects ageing infrastructure, underinvestment during the Correa and Moreno administrations, and ongoing security disruptions in the Oriente basin from illegal tapping and pipeline sabotage.

The 12,000 bpd target from the new Sinopec drilling campaign would close only 6% of the current production gap -- underscoring the scale of investment required to achieve national output targets.

Deepening Chinese investment

The contract continues the expansion of Chinese capital and technical involvement in Ecuador's upstream oil sector. Sinopec and other Chinese state-owned enterprises now participate in multiple dimensions of Ecuador's hydrocarbon value chain:

• Sinopec: Sacha field PSC ($1.7B), Amazon drilling services ($105M)
• PetroOriental (CNPC/Sinopec JV): Blocks 14 and 17 in Orellana (~28,000 bpd)
• Andes Petroleum (CNPC/Sinopec): Block 62 (Tarapoa), ~14,000 bpd

China is also Ecuador's largest bilateral creditor, with approximately $4.6 billion in outstanding oil-backed loans -- a financial relationship that analysts note creates structural incentives for Chinese companies to maintain operational presence in Ecuador's upstream sector.

What to watch

Key milestones include rig mobilisation, expected to begin in Q2 2026, and the first production results from newly drilled wells approximately 6-8 months after spud date. The broader indicator is whether Petroecuador's combined drilling programmes -- including the Sinopec contract and the Sacha field PSC -- can arrest the national production decline. Monitor Petroecuador's monthly production reports and any modifications to the 600,000 bpd national target at the government's mid-year economic review.

Sources: energynews.pro, Argus Media, Petroecuador