News and AnalysIs for

Our Monthly Report for March 2013 is now available for download (see below). We have a guest commentary on gas pricing by Felipe Villegas Gómez, León Teicher gives his opinion on best practices for managing community relations and monthly collaborator Tomás de la Calle writes on the economics of exporting oil from Colombia.

The oil & gas and mining companies currently present in Colombia complain, rightfully so, about the lack of coordination between the various ministries and institutions of the state, which inevitably generate delays and uncertainty for their business.

As reported by Dinero, the Sustainable Integrated Management Report 2012 presented by Ecopetrol during its shareholders meeting was qualified, for the second year running, with an A+ (the highest rating) by Global Reporting Initiative (GRI), a sustainability reporting rating company.

Naturgas, the association of producers, transporters and distributors held its annual meeting in Cartagena last week. Colombian President, Juan Manuel Santos, attended a ribbon cutting ceremony to launch gas services in a historic small town near the city and then addressed the association’s membership, giving a pep talk for domestic gas. From a Naturgas press release, translated and with commentary by Hydrocarbons Colombia.

Rafael Ramírez, president of Petroleos de Venezuela (PDVSA) said the company made net profit of US$4.2B last year, down from the US$4.5B reached in 2011. PDVSA’s total revenues in 2012 were US$124.5B while in 2011 they totaled US$124.7B. Business magazine America Economia reports Ramirez saying: “We have a difference that I think is not very important, US$200M (…) in a similar environment.”

As reported by the Colombian news media, during the General Assembly, Javier Gutiérrez, President of Ecopetrol, said that because of the 109 attacks against the oil infrastructure of the company, last year nearly 9,559bd were lost, of which 6,000bd correspond to Ecopetrol. For this reason, since last year the company added new monitoring technology, strengthened the inspection and maintenance procedures for pipelines and transportation systems. He added: “We are investing to anticipate such attacks and maintain transport infrastructure integrity, for which we are spending US$359M.” Gutierrez said that Ecopetrol invested US$5.3M to strengthen contingency plans, drills and inform about 1,350 communities.

Last week was the natural gas industry association’s annual conference and he minister’s speech is a much anticipated event. MinMinas Renjifo did not disappoint the crowd with the breadth of his speech but we understand the content has the industry concerned over certain points. From a MinMinas press release, translated and with commentary by Hydrocarbons Colombia.

Maybe he took vacation or maybe these things just take time. The changes were announced weeks ago and the former head of the ANH, Orlando Cabrales, has already made a few speeches in his new capacity as Vice-Minister of Energy. The new head just took possession last week and has made no public comments. From a MinMinas press release, translated and with commentary by Hydrocarbons Colombia.

Portafolio reported that during the XVI Naturgas Congress, the superintendent of Domestic Public Services, César González Muñoz, said the management of the Gas Development Fee Fund budget has been inefficient, because the US$30.5M (77% of total approved projects) invested between 2007 and 2012 benefited only 54,601 of the 78,823 users the government expected to benefit.

The USO reports this week that workers at Reficar and with Oxy are getting closer to strikes, the union says because local management refuses to talk. In the Reficar case, the USO claims that executives from Bogota have contacted the union but Reficar management will not set up the mechanisms to start negotiating. In the case of Oxy workers in Arauca, the union has presented demands but the company will not budge.