Business magazine Dinero reports that the Comptroller General found irregularities in royalties’ resource management. According to a Comptroller’s report there are US$260Mn at risk in the Caribbean, Central East, Coffee Region, Llanos, Pacific and Central South regions, and projects from the National Royalty Fund in liquidation, for unfinished projects and for projects that do not work or have overruns.
In an interview with RCN Radio, MinHacienda Mauricio Cárdenas spoke of the need to increase oil reserves and the consequences of last year’s attacks against pipelines in the country. Cardenas said that considering there is enough oil in Colombia only for the next eight years, it is necessary to increase exploration; and this needs investment: “we need to explore properly: first, seismic activity. Then the expensive part of drilling wells, which can be worth US$30M, US$40M or US$50M.” He added that “this year Ecopetrol has US$10B, of which US$6B are for exploratory process. They are drilling more wells than at any time in their history. “
National weekly news magazine Semana published an article with the collaboration of Juan Carlos Sierra on the need for prior consultations with indigenous people in the Tayrona National Natural Park, and how this may influence the approval of other projects in other regions of the country.
In an interview with RCN Radio, the mayor of Arauca, Luis Emilio Tovar, said that after a week of protests, the situation at the Caño Limon Coveñas complex was partially normalized: “The entrance to the Caño Limón complex was restored; we are already entering with a military convoy. The rest of the department is blocked but today the public transportation is available and people are coming and going to Arauca “.
Last Friday Ecopetrol announced its financial results and despite the spin – “second best profits in history” – they were in fact down from 2011. Consolidated Net Income was down 4.4% over 2011 and the chart shows this was not caused by accounting, foreign exchange or other easier to rationalize explanations. These non-cash items actually improved results since Operating Income was down 6.4% and EBITDA down 3.2%: it was operations that sunk the ship. And this despite a 4.4% increase in consolidated revenues and a 4.1% increase in crude oil production. The only hero in this story is Exploration and Production which produces almost all of the profits and even it saw margin declines in 2012. Most of the other businesses Ecopetrol is involved with do not. If this were a normal company, institutional shareholders would be screaming to break it up.
The Emir of Qatar visited Colombia last week and he and President Santos signed a number of agreements for intergovernmental cooperation. Although the agreements spanned a range of activities including sport, we found this press release on the MinMinas web page. Translated and with commentary by Hydrocarbons Colombia.
The National Hydrocarbons Agency seeks comments by Friday, February 22, 2013 on a proposed change to royalty payments for fields where payment in kind is difficult. They call such areas Difficult to Recover Production Fields (CPDR) and rather than payment in kind, operators are to pay in cash based on production and recent average pricing.
The USO news this week highlighted an ongoing fight about the December 11th death of Milton Rivas, a union leader in Puerto Gaitan. Public officials claim his death was the union’s fault something obviously denied by the leadership. The USO’s president went to Washington to claim Rivas’ death was a result of deteriorating working conditions caused by the Free Trade Agreement with the US, a claim that makes no sense whatsoever considering this is Puerto Gaitan and not Caño Limón.
Multiple sources in the Colombian news media reported that Pacific Rubiales has signed an agreement with the National Agency to Overcome Extreme Poverty (ANSPE) and the Puerto Lopez mayor’s office, to help eradicate poverty in this municipality.
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