By Jack Kimball
BOGOTA, Aug 9 Pacific Rubiales Energy Corp
, the largest private oil producer in Colombia, said on
Thursday it would raise output from its Rubiales field by 10.5
percent to 210,000 barrels of oil equivalent per day (boepd) in
2013 versus the end of 2012.
Latin America's fourth-biggest oil producer, Colombia, has
ramped up oil output over the last decade after a U.S.-backed
military offensive made areas of the country safer for investors
and helped reverse years of declining crude output in the 1990s.
Thanks to an environmental license at its Rubiales oil
field, it should increase production to 190,000 boepd by the end
of 2012 and to 210,000 boepd in 2013, CEO Ronald Pantin told an
investor call about the company's second quarter results.
The Rubiales field currently produces 172,000 boepd.
The field located in the heavy-oil-rich Llanos Basin is one
of Colombia's signature success stories. Burnt to the ground by
rebels more than a decade ago, better security and fiscal terms
has turned Rubiales into Colombia's top producing field.
A military crackdown over the last decade pushed Marxist
guerrillas into remote hideouts, and foreign oil companies have
flooded in, snapping up assets in a country once largely
dismissed as a failing state.
The FARC rebel group is weaker than it has been in decades,
but still poses a threat and has stepped up attacks on the oil
industry while the sector has also faced increased demands from
local communities in oil-producing provinces.
Colombia's national oil production has shot up to a record
of around 950,000 bpd and the government hopes to hit 1 million
bpd this year -- increased output at Pacific's fields are seen
as key to reaching the goal.The company said it expected production at its Quifa field,
also in the Llanos, to rise to 60,000 bpd by the end of this
year from 44,500 bpd in the second quarter. It did not give an
outlook for output in 2013 for Quifa.
In the April-June period, Pacific sold 42 percent of its
crude to the United States, 31 percent to Europe and 20 percent
to Southeast Asia.
Total production for Pacific -- which also has operations in
Peru -- was around 250,000 bpd on Aug. 7, the company said.
Net income in the second quarter fell 36 percent versus the
same period last year to $224 million while gross revenue
increased 8 percent to $1.04 billion in the same timeframe.
"Overall, the financial results of the second quarter, 2012
evidenced the deterioration of margins due to higher costs and
expenses, and confirmed our concerns regarding the lack of
growth in production due to the delay in the approval of
licenses," local brokerage InterBolsa said in a research note.
"However, we expect a positive effect on the stock price, as
we believe that the approval of the environmental license to
expand production at the Rubiales field and the positive results
of the exploration campaign in Quifa North and Sabanero should
offset a slightly negative reading of the financial results."
Pacific stock rose 4.2 percent on the Colombia's
stock exchange on Thursday.