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It apparently only dawned on President Juan Manuel Santos last week at the annual mayors’ meeting that the new royalty system had left some producer municipalities without funds. This is the fourth of four articles we have published this week as the government tries to solve in a matter of days, a problem that has built up over a year. From a DNP press release, translated and with commentary by Hydrocarbons Colombia.

We do not usually comment on global petroleum trends but having stared at this graph for weeks now we thought it worth publishing. It shows weekly closing prices for the two most commonly discussed benchmark prices – WTI and Brent – in US dollars going back to just about a year before the collapse of Lehman Brothers, the generally accepted start of the current financial crisis.

It was widely reported in the Colombian press that Colombia and Ecuador signed an agreement for Colombian oil transportation by the Heavy Crude Pipeline (OCP) located in Ecuadorian territory. The purpose is to provide an alternative to the frequently interrupted TransAndino Pipeline.

It was widely reported in the Colombian press that Colombia and Ecuador signed an agreement for Colombian oil transportation by the Heavy Crude Pipeline (OCP) located in Ecuadorian territory. The purpose is to provide an alternative to the frequently interrupted TransAndino Pipeline.

The eighth round of peace talks between the government and the FARC began on Tuesday in Havana. Humberto de la Calle, chief negotiator of the government, said he has the “purpose of making decisions.”

As reported by Portafolio, the Comptroller General recovered US$4.1M from royalties through its audit program. The payment of this money was made by the insurer QBE, guarantor of the royalties in the departments of Meta and Casanare. According to the Comptroller, both departments made “risky fiduciary operations”, in which public money was put into a trust constituted by private individuals and got lost by not returning to the corresponding territorial public funds.

In an interview with El Espectador, MinMinas Federico Renjifo spoke about oil and environmental licenses, among other topics. Regarding oil production, Renjifo said: “This year we reached 1.014M barrels. This month we reached 1.027M barrels and we can reach 1.033M barrels. It has been a good indicator and the challenge is to maintain that production. We have increased reserves. Colombia requires a reserves increase.” He added that it is necessary to increase exploration, since there has not been a great discovery and current reserves are extracted from small wells.

President Juan Manuel Santos clearly got an earful last week at the annual meeting of the country’s mayors. This is the second major change to the now not-so-new royalty process within days. From a DNP press release, translated and with commentary by Hydrocarbons Colombia

Considering that the US is perhaps the most pro-unconventional hydrocarbons country and Colombia needs to start making decisions about how to manage the environmental issues, we can only hope this agreement is good news. From a MinAmbiente press release, translated and with commentary by Hydrocarbons Colombia.

Gran Tierra recently published a 1Q13 production update and we thought it illustrative of what many mid-sized companies have been saying, providing an upbeat message to compensate for other down signals.