The Future of the Oil Industry in Colombia

The move towards cleaner energy in Colombia is discussed, with assurances from Ecopetrol CEO Ricardo Roa that this does not mean the end of the oil industry.
industrie en colombie

Partagez:

The Future of the Oil Industry in Colombia looks at the transition to cleaner energy and its impact on the country’s oil and gas industry. Ecopetrol CEO Ricardo Roa reassures us that this transition will not mean the end of theoil industry in Colombia.

Gustavo Petro’s Vision of the Presidency

The government of President Gustavo Petro, Colombia’s first leftist leader, aims to reduce the country’s dependence on hydrocarbons, mainly oil and coal, which are major drivers of the economy, in favor of renewable energies. Last December, Ecopetrol announced its intention to invest between 25.3 trillion and 29.8 trillion pesos (or between 6 billion and 7.1 billion dollars), focusing on the transition to renewable energies and ensuring energy self-sufficiency.

Reassurance about the future of the oil industry

“We never said we were going to end our traditional business in the oil and gas sector,” Roa told an industry forum in Cartagena, organized by the Colombian Petroleum Association (ACP).

Concerns of the Workers’ Union

The oil workers’ union, USO, said in a statement posted on social networks on Monday that Ecopetrol plans to cut its investment in exploration and production by more than 40%, from $4.5 billion this year to $2.5 billion in 2024, threatening the company’s future.

Investment scenarios

In response to the USO press release, Roa indicated that Ecopetrol is considering two investment scenarios for next year, a basic scenario and a more ambitious one. The baseline scenario calls for an investment of $3.5 billion to reach an average production of 720,000 barrels per day next year, said Roa. The high-investment scenario, on the other hand, would require $4.2 billion to approach 731,000 barrels per day.

Ecopetrol’s production targets

Ecopetrol hopes that production will reach a rate of 731,000 barrels per day by the end of this year, he added. A presentation provided by the company suggests average production of between 720,000 and 725,000 barrels per day. Last year, Ecopetrol produced an average of 709,500 barrels per day, according to a report published in February.

The Role of Fossils in the Energy Transition

“The oil and gas industry in the country is not going to disappear,” Roa asserted, pointing out that funds from fossil fuels will be essential to finance the transition to renewable energies.

It’s clear that Colombia faces major challenges in its energy transition, but that doesn’t mean the end of the oil industry. Ecopetrol’s investments in renewable energies demonstrate its commitment to a more sustainable future. However, it is also crucial to maintain stable oil and gas activity to support the transition. Prudence and strategic planning are essential to balance these objectives.

Ultimately, the future of Colombia’s oil industry will depend on its ability to adapt to the energy transition while preserving its assets and guaranteeing the country’s energy security. The decisions taken by Ecopetrol will have a significant impact on the sector and on the Colombian economy as a whole. The debate between reducing investment and preserving the oil industry has only just begun.

The closure of the Grangemouth refinery has triggered a record increase in UK oil inventories, highlighting growing dependence on imports and an expanding deficit in domestic refining capacity.
Mexco Energy Corporation reports an annual net profit of $1.71mn, up 27%, driven by increased hydrocarbon production despite persistently weak natural gas prices in the Permian Basin.
S&P Global Ratings lowers Ecopetrol's global rating to BB following Colombia's sovereign downgrade, while Moody’s Investors Service confirms the group's Ba1 rating with a stable outlook.
Shell group publicly clarifies it is neither considering discussions nor approaches for a potential takeover of its British rival BP, putting an end to recent media speculation about a possible merger between the two oil giants.
The anticipated increase in the tax deduction rate may encourage independent refineries in Shandong to restart fuel oil imports, compensating for limited crude oil import quotas.
Petro-Victory Energy Corp. starts drilling of the AND-5 well in the Potiguar Basin, Brazil, as the first phase of an operation financed through its strategic partnership with Azevedo & Travassos Energia.
The Texan Port of Corpus Christi has completed major widening and deepening work designed to accommodate more supertankers, thus strengthening its strategic position in the US market for crude oil and liquefied natural gas exports.
BP Prudhoe Bay Royalty Trust is offering its interest in Prudhoe Bay, North America’s largest oil field, as part of its planned dissolution, assisted by RedOaks Energy Advisors for this strategic asset transaction.
CNOOC Limited’s Hong Kong subsidiary and KazMunayGas have concluded a nine-year exploration and production contract covering nine hundred and fifty-eight square kilometres in Kazakhstan, sharing investment and operations equally.
Donald Trump announced that the United States will no longer oppose Chinese purchases of Iranian oil, immediately triggering a drop in global crude oil prices and profoundly reshaping international energy trade partnerships.
Research firm S&P Global Commodity Insights lifts its outlook for the fourth straight year, betting on three point five mn barrels per day from 2025 despite lower prices.
Enbridge plans to expand its infrastructure to increase oil transportation from the American Midwest to the Gulf Coast, anticipating rising exports and addressing current market logistical constraints.
US commercial crude inventories significantly decline by 3.1 million barrels, widely surpassing initial forecasts and immediately pushing international oil prices higher.
The UK could have hydrocarbon reserves twice as large as current official estimates, according to Offshore Energies UK, highlighting the impact of fiscal policies on forecasts and the economic future of the North Sea.
Following US strikes in Iran, international energy companies partially evacuate their teams from Iraq as a precaution, while Lukoil maintains its entire personnel on southern oilfields.
Chinese independent refineries remain cautious amid rising Iranian crude prices driven by escalating Iran-Israel tensions, potentially threatening access to the strategic Strait of Hormuz.
Gazprom, affected by a historic $6.9bn loss in 2023, is offering Pakistani state-owned firm OGDCL its petroleum assets in Nigeria to strengthen its presence in Asia’s energy market, according to Pakistani sources.
Donald Trump urges control of oil prices following U.S. military action against Iranian nuclear facilities, amid escalating tensions around the strategic Strait of Hormuz, threatening to significantly impact global markets.
PermRock Royalty Trust announces a monthly distribution of $539,693 to unit holders, impacted by reduced oil volumes and prices in April, partly offset by increased natural gas sales.
Permian Basin Royalty Trust announces a reduced distribution for June due to ongoing excess costs at Waddell Ranch properties and lower volumes from Texas Royalty Properties.