Canadian oil firm Pacific Rubiales Energy said on Thursday it agreed to pay US$190 million to the Colombian Central Pipeline SA for the rights to use its crude pipelines for 10 years.
The agreement to transport 160 million barrels of oil will go into effect next month, according to a letter sent from Pacific Rubiales to Colombian stock market regulators.
“Pacific Rubiales Energy Corp … has reached an agreement with Central Pipeline SA to acquire claims on the available capacity of the transportation system of that company, to carry up to 160 million barrels for a period of ten years,” the letter said.
The pipelines run from oil fields located in Colombia’s central jungles to the country’s Caribbean coast.
“This agreement is vital for us, to ensure the continued flow of oil from the Rubiales and Quifa to a low transportation cost,” Rubiales Chief Executive Officer, Ronald Pantin, said in the letter.
The company produces more than 111,000 barrels a day and about 60 million cubic feet of gas in Colombia and it is ranked as the most active private firm in the countries oil sector.
Pacific Rubiales, which plans investments of US$853 million in 2010 in Colombia, said last month that it expects to reach production of 225,000 barrels of oil equivalent a day in 2010 as it develops three sites in Colombia and aims to reach reserves of 400 million to 450 million barrels next year.
Shares of the Toronto-based Pacific Rubiales were trading at C$15.00, up 6 cents, on the Toronto Stock Exchange.
Pacific Rubiales shares traded on the Colombian Stock Exchange were trading at COP29,000, up from its Wednesday close at COP28,800.