Despite major protests and demonstrations, Ecuador is not prepared to drop its proposal for free trade pact with the United States, while state-owned company PetroEcuador may strike a new deal with Occidental, reports from the South American country said on Thursday.

Cancellation of the trade pact "is not possible, at least not right now," said Ecuadorian President Alfredo Palacio, "First we have to complete negotiations, and once we have that negotiated, we will consult the representative of the people in Congress."

Ecuadorian officials began the last round of trade talks in Washington on Thursday.

Palacio said he was also suspicious of the motivations of some demonstration leaders, saying there appeared to be "dark forces trying to undermine our democratic system."

In a further development on Thursday, PetroEcuador President Fernando Gonzalez, said the company might begin new negotiations with U.S.-based oil company Occidental Petroleum Corporation, if, as seems likely, an Oil Ministry-led court declares Occidental's current contract invalid.

Occidental has asked for an extension of its existing contract to 2019 from 2012 this month, Gonzalez said. The company has also separately offered to pay the nation millions and set up schools in the Amazon to clear its legal problems.

If the contract is cancelled, Occidental's property would be automatically transferred to the state without any financial compensation.

Ecuador is experiencing massive protests, which began 11 days ago. Some 22 Ecuadorian provinces are affected.

Demonstrators, who have closed many roads and highways, are demanding a referendum on the trade deal and that Ecuador cancel the oil concession granted to Occidental, which has been embroiled in tax and contract disputes with Ecuador's government since August 2004.

Source: Xinhua