News and AnalysIs for

Ecopetrol and Chevron will upgrade the compression facilities at the Chuchupa field to increase its daily gas production. For this, the field will be off-line from October 30th to November 3rd. More maintenance will take place at the end of the month. From an Ecopetrol press release, translated and with commentary by Hydrocarbons Colombia.

The National Hydrocarbons Agency (ANH) recently published basic exploration statistics as of September 2012. From a drilling point of view the news is not good — the country is likely to fall short by 58 wells — and from a success point of view the story is even worse. Only 3 of the 93 wells drilled are reported as being productive and all 34 A3 wells that have come to a definite conclusion have been declared dry. There are still 52 A3 wells under testing. Seismic is a better story with the country likely to exceed its targets for kilometers of seismic by a comfortable margin (see chart at the bottom of this article).

The National Environmental Licensing Agency (ANLA) has issued a press release encouraging comments on a specification document for its new GeoDataBase system. The system’s goal is to unify all the environmental information that companies and the ANLA need to process an application. The idea, as described last week at the National Hydrocarbons Agency convention in Cartagena is to simplify and thus speed licensing and minimize requests for additional information.

The main road from the Llanos Basin to the central part of the country is only two lanes and extremely narrow at various points. Tanker trucks carrying crude from the fields and returning with naphtha for dilution clog up the roads. There have been accidents and some deaths. See our earlier article here. Work was supposed to have started on widening the most complicated portions but that is still generating controversy.

Last Friday, Defense Minister Juan Carlos Pinzón addressed the National Hydrocarbons Agency (ANH) conference in Cartegena. The speech was full of statistical information and the crowd gave him a standing ovation. This is the MinDefensa press release on the speech, translated and with commentary by Hydrocarbons Colombia.

We have been tracking incidents near hydrocarbons infrastructure since the beginning of 1Q12. The Colombian government and the Colombian Petroleum Association track events where the infrastructure itself is attacked. We use a radius of 20km and count any event that involves terrorism of one form or another. We believe this gives a more accurate picture of the risk associated with a particular area. It also allows us to assess the risk of zones that do not yet have infrastructure, such as an exploration block.

During the National Hydrocarbons Agency (ANH) conference in Cartagena last week, Ecopetrol and the China National Petroleum Corporation (CNPC) signed an agreement to develop exploration and production opportunities both in Colombia and other countries. Here is an Ecopetrol press release on the agreement, translated and with commentary by Hydrocarbons Colombia.

There are many arguments about whether the 2012 Round (Phase I) was a success or failure but with only 5 of 30 blocks assigned there is no doubt about the non-conventional blocks.

We attended the first pass at the 2012 Round on Wednesday October 17th. There will be a second round on November 28, 2012 where the same pre-qualified companies will have a chance to bid on blocks left unassigned in the completed phase.

Eduardo Junguito had 15 minutes to address the ANH conference in Cartegena today. He used about 25 minutes and had material for an hour. Yet another player in the complex and overlapping responsibilities for community relations and the extractive industries, Junguito has an ambitious agenda that not all would agree with. Still there were some positive messages of intent even if practical demonstrations of implementation were lacking.