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Last Updated: Wednesday, 24 August 2005, 02:36 GMT 03:36 UK
Compromise on Ecuador oil crisis
Protester in Ecuador
Protesters want oil companies to invest more in local infrastructure
Protesters from an oil-rich region of Ecuador say they are cautiously optimistic about reaching a deal with the government to end demonstrations.

But the protest leaders say obstacles do remain after two days of talks.

The protesters want the government to increase the amount of oil revenue invested in the Amazonian region surrounding Ecuador's oil fields.

Oil output fell significantly after the protesters seized control of a number of oil installations last week.

The government now says it is in control of the facilities and the army is enforcing a state emergency in two affected provinces.

Aide quits

In a separate development, another close aide to the Ecuadorean president, Alfredo Palacio, has stepped down after apparent disagreements over the protests.

Map of Ecuador

The official, Andres Seminario, was the president's press secretary.

He is believed to have quit after disagreeing with Mr Palacio's tactics over efforts to end the protests.

The defence minister, Solon Espinosa, resigned last week.

Ecuador is South America's fifth-largest oil producer and more than half of its exports go to the United States.

Along with a call for greater investment the protesters are also demanding the exclusion of US-based company Occidental Petroleum (Oxy).

President under pressure

The talks between the protesters and government officials and oil executives came after the two sides agreed a truce on Sunday.

Last week's events left dozens injured and brought the country's oil production to a halt.

The government said it faced an "economic emergency" as a result of the stoppage, which sent world oil prices higher.

Ecuadorean officials estimate production will not return to normal until November.

Correspondents say the unrest is the worst faced by Mr Palacio since he came to power in April.

They say he is under pressure at home to abandon the free-market policies of his ousted predecessor, Lucio Gutierrez.

See the army move in on protesters

Ecuador oil protesters call truce
22 Aug 05 |  Americas
Ecuador's army tackles protesters
20 Aug 05 |  Americas
Protests halt Ecuador oil exports
19 Aug 05 |  Americas
Protest threat to Ecuador oil
26 Feb 02 |  Business
Country profile: Ecuador
19 Jul 05 |  Country profiles

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