CDB provides RMB 1.9 billion via Tranche B of $2 billion oil-backed loan facility in December 2012 (Linked to Record ID#36002)

📋 Staff Comments

1. This transaction was governed by a Facility Agreement between CDB and the Ecuadorian Ministry of Finance that was signed on December 20, 2012 and by a Five Party Agreement (between CDB, PetroChina International, UNIPEC Asia Co. Ltd., Ecuador's Ministry of Finance, and PetroEcuador) that was signed on September 6, 2012. The Five Party Agreement links the Facility Agreement to an Oil Sales and Purchase Contract between PetroEcuador and PetroChina International and an Oil Sales and Purchase Contract between PetroEcuador and UNIPEC Asia Co. Ltd. The Oil Sales and Purchase Contract that Petroecuador signed with PetroChina International on December 20, 2012 can be accessed in its entirety via https://www.dropbox.com/s/nmz5jx1cbucyzh7/Petroecuador%20Oil%20Sales%20and%20Purchase%20Contract%20with%20PetroChina%202012.pdf?dl=0. The Oil Sales and Purchase Contract that Petroecuador signed with UNIPEC Asia Co. Ltd. on December 20, 2012 can be accessed in its entirety via https://www.dropbox.com/s/wkk7by6ublkwah3/Petroecuador%20Oil%20Sales%20and%20Purchase%20Contract%20with%20UNIPEC%20Asia%202012.pdf?dl=0.
2. From 2010 to 2016, the Government of Ecuador entered into four separate loan agreements with China Development Bank totaling $7 billion which are related to a multi-party contractual structure that involves crude oil delivery contracts entered into with PetroChina and Unipec. Deliveries under these contracts are based upon international spot prices, such as WTI plus or minus a spread, plus a premium paid due to the term of the contracts. The spread is calculated using Argus, a crude oil price assessment publication (“Argus”) and the quality of crude oil as measured by the American Petroleum Institute. Under these agreements, Ecuador is required to invest the loaned amounts in specific infrastructure projects or programs in Ecuador. The $1 billion loan agreement with CDB in 2010 is captured via Record ID#35865. The $2 billion loan agreement with CDB in 2011 is captured via Record ID#69319 and ID#69320. The $2 billion loan agreement with CDB in 2012 is captured via Record ID#36002, and#58827. The $2 billion loan agreement with CDB in 2016 is captured via Record ID#58839 and ID#58842.
3. The Ecuadorian Ministry of Finance loan identification number is 23167000 for the $1.4 billion component of Tranche A, 23167001 for the $300 million component of Tranche A, and 23167002 for the RMB 1.9 billion tranche (Tranche B).

📚 Sources & References

• Are China’s Loans to Ecuador a Good Deal? The Case of the Sopladora Hydro Project
• Building Development for a New Era: China’s Infrastructure Projects in Latin America and the Caribbean, 2019 Bond Prospectus Government of Ecuador
• Resource-Backed Loans: Pitfalls and Potential
• China's Financing in Latin America and the Carribean
• China
• Ecuador Sign $2 Billion Loan Deal
• El detalle de los contratos de crédito externos o internos
• TERMINOS-Y-CONDICIONES
• Petroecuador Oil Sales and Purchase Contract with UNIPEC Asia 2012
• Petroecuador Oil Sales and Purchase Contract with PetroChina, petroecuador_-_letter_to_cdb_regarding_closing_of_phase_iii-LF
• Contratos de crédito externos e internos (2018-2022)
• Ecuador to receive $2 bln from China Development Bank for investment Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.