4. Oil production is declining (6% drop in 2007, according to Acosta)    .... Maybe oil co's are just fiddling 6% of their profits, look at my previous post re tax evasion in Equador.

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There's any number of possible reasons for the drop, but I suspect it has to do with maturing fields.   I don't know the particulars, but I think it's significant that they want to open up that new area (forget name -too lazy too look it up) in the Amazon.

5. Reserves exhausted in 30 years at current rates.  ... WHO SAYS?

 I should have posted the calculation, but I didn't want to crowd the post with too much info.  I base this on 5 billion bbls stated reserves divded by 450,000 bbl/day output.  Numbers taken from the CIA factbook and rounded down for simplicity, and to account for production decline.  The actual number, using their figures is 28.4 years.  That assumes no increase in production or reserves, and doesn't account for peak effects, such as Mexico is encountering with Cantarell.

www.cia.gov/library/publications/the-world-factbook/geos/ec.html#Econ

 This is far and away the single biggest challenge facing all of Latin America:  what to do when oil production starts to decline?  So far, only Brazil seems to have dealt with this, but I'm sure a large part of the motive behind Banco del Sur and forming a common market has to do with addressing this problem.  Japan can export high value added goods to pay for their oil, but what can Ecuador do?  Agricultural products won't carry them - they need a steady market in some value added or high volume good.  Copper won't do it entirely, but it will make a dent.  What they really need to do is follow the lead of Brazil and get an ethanol industry going.  Dieselization is another step they need to consider.  I expect the upgrades to the Esmeraldas refinery will take that into account - ie. processing heavy crude into diesel, which has higher yields than gasoline.  Right now they're importing 2.3 billion a year in refined product.  That has to change.

7. Ecuador has major copper potential ....  key word is POTENTIAL.

 Granted, but the geology is in their favor, and if they could get a refining industry going (note to self: study the electricity situation) they could export the metal, rather than the ore.  Value added.

8. Corriente is the poster child, invited to dog & pony show in China.   ....How can you say that when we don't know what went on in China?

 We know they went there.  They were also mentioned by name as a viable project that should be considered (over the objections of Acosta, who doesn't like open pit operations).

If I were taking this up with Acosta (who seems to think eco-tourism will carry the day) I'd simply point out the amount of damage caused by slash and burn agriculture and illegal logging, and suggest he consider a smaller footprint copper mine, as ugly as it may seem.  If your people are engaged in profitable mining, they aren't out damaging the forest to nearly the same degree.  This is one of the trade-offs you have to consider.  There are many others.

9. The Chinese have plans to build a port. ......  I have plans to buy a condo in Florida but it'll probably never happen.

 Probably because you have no pressing need.  The Chinese are facing all kinds of future shortages and have to think long-term.  Copper is vital for their electrification projects, which, combined with nuclear power will take some of the pressure off oil and coal consumption.  I'm getting a bit off topic here, but electric trains are the only viable solution to their long term transportation needs.  That's an awful lot of copper, aluminum, nickel, iron, moly, etc.  Lead times are in the decades, so they have to start accumulating the resources now.  Look at the price of oil today.  That's got to keep them up nights, worrying about the future.

But back to Ecuador.  If I were to editorialize (heh) on their future prospects, I'd say they have some huge advantages, oil being one of them (if managed correctly).  What I'd hoped to see from them was a mining friendly investment position, backed by tough environmental and labor standards to prevent the kind of problems encountered elsewhere. They have an opportunity to get it right from the get-go, and set the tone for the entire industry - become a model in fact.    I hope they see this.  Too often, short term political considerations get in the way of long range planning in this part of the world.

 And as I've already said, if they showed signs of progress along these lines, I'd consider moving down there and helping out.   I'm not doing much up here anyway, and a fresh challenge is just what I need right now.

 ebear