Ecopetrol eyes US$10 bln in overseas buys

Colombia’s
state-controlled oil company Ecopetrol ECO.CN could
spend up to $10 billion to purchase overseas assets over the
next six years, a senior executive said on Tuesday.

“We have budgeted $10 billion in our strategic plan for
international acquisitions,” Ecopetrol Vice President in Charge
of Exploration and Production Nelson Navarrete told reporters.

The company — which has branched out of Colombia into
Peru, the Gulf of Mexico and Brazil — is considering expanding
into Venezuela, Egypt, Norway and Indonesia, Navarrete said in
a presentation at the Institute of the America’s Latin American
energy conference.

Ecopetrol plans to spend $60 billion to more than double
crude oil production by 2015. The company is expected to tap
international bond markets later this year for at least $500
million. Navarrete said the issue could be up to $1 billion.

Rising production from Ecopetrol, which currently produces
460,000 barrels per day of oil, has been a key factor behind
the renaissance of Colombia’s oil sector.

Once written off by analysts as an oil exporter due to a
lack of major new discoveries, Colombian oil production has
been rising in recent years. The government expects output to
reach 650,000 barrels per day this year, up from 587,000 bpd in
2008.

Part of the increase will come from the Rubiales field,
where new pipeline infrastructure will allow Ecopetrol to boost
production to 100,000 bpd from 55,000 bpd today, Navarrete
said. Output from Rubiales is currently trucked out.

Ecopetrol will also take over one of the three operating
licenses at the Cusiana-Cupiagua oil and gas field later this
year when BP Plc’s license covering the Cupiagua
section expires. BP will continue to operate the other two
licenses until 2018.

Ecopetrol has been on the acquisition hunt in Colombia
recently, snapping up a stake in a major crude oil pipeline and
agreeing deals to buy Glencore’s 51 percent share in a local
refinery and the Hocol affiliate of France’s Maurel and Prom.

It is also one of the companies that has been invited to
participate in Venezuela’s bidding round for acreage in the
Carabobo sector of the Orinoco heavy oil belt slated for later
this year.

The company is mainly looking for nonoperating interests as
it moves overseas, Navarrete said. Ecopetrol currently holds
nonoperating interests in two wells being drilled in the Gulf
of Mexico and is seeking to farm into another two wells.

Ecopetrol is 89.9 percent owned by the Colombian
government. Its shares are listed both in Bogota and New York. (Reuters)

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