The oil industry is not the only sector to suffer from constant blockades and protests. Mining projects, electrical lines and new highways have all suffered delays due to an increasing conflictive community relationship.
A new law signed by President Juan Manuel Santos will allow departments to apply royalty funds to bills for additional health care, and cover outstanding debts with service providers and insurers, an area where a number of departments are suffering financially.
Low prices have led to a number of closures and cutbacks in the oil industry’s investments and productions. According to numbers from the National Hydrocarbons Agency (ANH), this combined impact has shuttered 15 fields and represents a loss of 20,000bd on average.
Fuel shortages, imported gasoline, a protested related death, soaring food prices, accusations of corruption and violence along Colombian roads are just a few of the consequences reported from the truckers’ strike that is already well into its second month.
The Nasa Kiwnas Cxhab indigenous community in Putumayo accused Gran Tierra Energy (TSX:GTE) of desecrating a holy site and exposing its community to risk, and claims that the Ministry of the Interior has not recognized its presence in an area granted an environmental license. UPDATED with commentary by Gran Tierra.
The list of communities taking legal action, through popular referendums, POT zoning ordinances, court actions or other tactics, continues to grow. The latest to join the fray is the Morelia Municipality in Caquetá.
A year after a blockade and protest led to intervention from riot police and national attention, residents in Valparaiso, Caquetá have again opposed reactivated exploration activities. This depicts the challenge for the industry to reach areas with potential for oil production that have previously been off limits due to the armed conflict.
Another conflict brewing in Putumayo has come about after a community fully-rejected a seismic program in its territory during a prior consultation, but the license was granted, providing a test case on the limits of the process.
The Finance Ministry’s (MinHacienda) plan to cover medium-term gaps in its budget created by a loss of oil income are drawing skepticism from analysts, who doubt that tax increases, a widened deficit and a “new economy” based on new and traditional sectors will cover the lack of oil income.
There is much said in the press about Colombia’s cost of fuel, most of it alleging a high drain on Colombian wallets. But a comparison of the costs in other Latin American countries show that it is far from being one of the most expensive countries.
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