News and AnalysIs for

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.