Reuters reports that Colombian state-run oil company Ecopetrol has embarked upon a US$3.5 - 4 billion investment plan this year to boost production and explore for more oil to replenish dwindling reserves.
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Ecopetrol has boosted its investment by more than US$1 billion, from US$2.2 billion a year earlier, to finance drilling 620 wells in 2018, according to Reuters. Ecopetrol is targeting output of 725 000 bpd of crude and gas equivalent by the end of the year, up from about 700 000 now, and the has set a more aggressive target of 870 000 bpd by 2020.
Castilla, Ecopetrol’s most profitable oilfield, is pumping about 115 000 bpd but should approach 125 000 by the end of next year, said Jose Cotello, Vice-President for the Orinoquia region in eastern Colombia, which includes Castilla.
The expansion would make it the country’s biggest producing field. It pumps heavy oil, which typically sells at a discount to lighter crude that is easier to refine.
Right now, however, heavier crude is in demand among refineries worldwide because of a fall in output of similar oil from neighbouring Venezuela, where lack of investment has pushed production to its lowest level in decades.
The country’s presidential election slowed spending, because anti-corruption laws make it difficult for public companies to open bidding processes for contracts during the electoral process, Ecopetrol said.
Colombia’s incoming President Ivan Duque will be inaugurated in August and has promised to help the energy industry. He has said he will invest in the state-run company’s refineries and crack down on militant groups that have attacked oil pipelines. He has also promised tax cuts across the economy, including for the energy industry, although has yet to disclose detailed proposals.
Colombia has struggled to attract investment and maintain energy output as conflict, protests and attacks by criminal gangs have frequently interrupted operations.
Pumping through the Cano Limon-Covenas oil pipeline restarted last week after 180 days stoppage due to repeated attacks by Marxist ELN rebels, military and industry sources said on Tuesday.
The 780 km pipeline has been attacked 58 times this year by the National Liberation Army (ELN), the largest active guerrilla group, according to military sources.
Although the latest outage was one of the most extensive since the pipeline opened in the mid 1980s, activity in the Cano Limon field, operated by Occidental Petroleum Corp and located in the northern Arauca province, has not been affected.
Read the article online at: https://www.worldpipelines.com/business-news/20072018/colombia-ecopetrol-set-to-boost-output/