Ecopetrol has been pushing its good corporate citizenship with a series of press releases on its spending in 2012. Environmental investments, local purchasing and local hiring have all been touched. While this may seem like ‘tooting its own horn’, we believe such a campaign is necessary for the industry as a whole, because of the negative opinions held by the press and certain politicians. From an Ecopetrol press release, translated and with comments by Hydrocarbons Colombia.
We made somewhat light of Ecopetrol’s announcement in March of a well with just over 200bd production. Now here is another announcement which is 3x the size! This is an improvement but it is still only a 0.1% increase in the company’s production. Like the last announcement, this one got wide coverage in the Colombian press. From an Ecopetrol press release, translated and with commentary by Hydrocarbons Colombia.
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.
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.
As reported by Dinero, by February this year the stock-market capitalization of the companies listed on the Colombia Stock Exchange (BVC) increased by 6% compared to February of 2012, going from US$248B to US$263B. This even though capitalization declined compared to January this year, when it was US$273B.
Ecopetrol is sending out a number of press releases designed to bolster its corporate social responsibility credentials. This week, environmental issues have the focus especially the company’s considerable investment as part of its long-term strategy to produce “clean barrels”. From an Ecopetrol press release, translated and with commentary by Hydrocarbons Colombia.
As reported by Semana, Ecopetrol has decided to remove control of the Colorada field (located in San Vicente de Chucuri, Santander) from the Universidad Industrial de Santander (UIS), which the company had given to the university in 2006 for training its students until 2016. At the time, the field was producing 14bd but it has been estimated that it could produce as much as 3,500bd.
It has been widely reported in the Colombian press that the arbitration commission has found in favor of Ecopetrol in its dispute with Pacific Rubiales. The result is an increase in Ecopetrol’s participation in the Quifa field, Pacific Rubiales’ second largest from the point of view of both reserves and production. This Portafolio article suggests that the wrangling is not over since the arbitrators declared they were not able to order Pacific to pay Ecopetrol the accumulated back payments. Pacific’s lawyer Nestor Humberto Martínez also spoke the newspaper about potential court action.
The ‘Qifa case’ has acquired a life of its own. This lawsuit between Pacific Rubiales and Ecopetrol turns on a clause that triggers an increase in Ecopetrol’s participation once production hits a certain level. The fight is over whether the trigger is defined by total production or just Pacific Rubiales’ net production. So much has been published on such little understanding that a number of ‘myths’ have arisen that Pacific has gone public to deny.