The United States has broken the negotiations with Ecuador on a free trade agreement after Quito decided to annul an operating contract with Occidental Petroleum Corp, a spokeswoman for U.S. Trade Representative's office announced Tuesday.

"We are very disappointed at the decision of Ecuador, which appears to constitute a seizure of assets of a U.S. company," said Neena Moorjani in a statement.

"At this time no further (free trade agreement) discussions are scheduled," she added.

Ecuador canceled Occidental's operating contracts on Monday, claiming that the oil company had broken the terms of its contract.

Moorjani said the U.S. government would seek an immediate clarification of Ecuador's action "including whether it intends to fully compensate the company as required under our bilateral investment treaty."

The United States started negotiations on free trade agreements with Ecuador, Peru and Colombia in May 2004. The talks with Peru concluded successfully in December and a deal with Colombia was reached in February.

Source: Xinhua