The ELN process is suspended! No wait. We reported that last month. But this month, Petro confirmed it. He’s given up on them. Still old news. The process with the Segunda Marquetalia almost fell off the rails but the two sides will meet now in Cuba. Didn’t we say that before? Maybe. Or something similar. The Clan? No change? Mordisco? Still blowing things up? Calarca? Not clear. Yesterday’s news.
Frank Pearl, president of the Colombian Oil and Gas Association (ACP), stands on the front lines of the industry’s relationship with the fervently anti-oil government of President Gustavo Petro. Pearl had just passed his one-year anniversary and Petro his second, so recently, I dropped by the ACP’s offices for a visit. I asked Frank where he saw the industry and where the association was going.
Its late September and most companies have started their planning processes for 2025. By November or December management teams will present their CAPEX budgets and performance targets for approval. For oil-focused E&Ps – and everyone else as well probably – most of the debate will be about the price of Brent.
A few weeks ago, we attended a meeting of the Colombo-Canadian Chamber of Commerce’s Mining and Energy Committee, which was held in the offices of Dentons Cardenas & Cardenas. The topic concerned changes to Colombia’s environmental sanctioning law and while the industry hopes never to have to confront a sanctionable situation, it is important to understand the penalties and how they might be assessed. We asked Maria Margarita Lorduy, Head of the Environmental Law Department at Dentons Cardenas & Cardenas to provide our readers with a brief overview.
Ecopetrol’s Net Income decline in 2Q24 attracted much negative commentary. While we worry about the NOC’s medium and long term performance, this was not a great quarter for anyone from a Net Income perspective while operating results were as expected.
The government hasn’t scheduled the funeral but the ELN process died this month, even if only unofficially. The autopsy is pending and resurrection is not out of the question, but for now, the corpse is lying in the front room waiting for somebody to do something with it. Fighting has restarted. As we begin the third year of President Gustavo Petro’s “Total Peace” initiative, everyone, including the government, wonders about a change of strategy.
On the first day of Shareholder Stewardship 101, the professor reminds everyone that different investors measure performance differently. One group of shareholders prioritizes short-term performance, long-term performance concerns others, and dividend flow to others. We know that Colombian President Gustavo Petro never attended that class but Ecopetrol Ricardo Roa seems to have missed it as well.
And it’s only half over… The past two years since President Gustavo Petro’s inauguration on August 7th 2022 have not lacked for excitement – or risk. For oil and gas investments in Colombia, the Chinese curse “May you live in interesting times” has never been more apt. But, frankly, we are living it and surviving.
For all the doom and gloom from commentators (like us!) and falling key driver statistics, oil production is up in 2024 versus 2023. Who or what is responsible?
The Petro government is no less scandal-ridden than previous Colombian governments, despite its rhetoric during the campaign, but this month embarrassing incidents exploded within the peace process, making an already shaking situation even worse. One of these may even have contributed directly to problems in the ELN negotiations, which seem mere days away from suspension if not collapse.
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