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Reuters Summit-Colombia Ecopetrol gains on 1 mln boepd target
March 30, 2011 / 6:40 PM / 7 years ago

Reuters Summit-Colombia Ecopetrol gains on 1 mln boepd target

 (For other news from the Reuters Latin American Investment Summit, click here)  
 * Ecopetrol may reach 1 mln boepd before 2015 target
 * Asia exports seen increasing over five years
 * Refinery, oil infrastructure projects on target
 By Patrick Markey
 BOGOTA, March 30 (Reuters) - Colombia's state-run oil company Ecopetrol (EC.N)ECO.CN said on Wednesday its output may reach 1 million barrels of oil equivalent per day (boepd) before a 2015 target and sees exports to Asia increasing over the next five years.
 Ecopetrol President Javier Gutierrez told the Reuters Latin America Summit that production was increasing more rapidly than initially expected, with output seen reaching 750,000 boepd this year from 616,000 boepd in 2010.
 "When we set that target in 2007 ... we had to grow 12 percent a year to reach 1 million barrels. In reality we have been growing faster than that," Gutierrez said.
 "Last year we grew 18 percent, this year we plan to grow 22 percent, so we could reach (the target) earlier."
 Colombia is now Latin America's No. 4 oil producer and the country is enjoying a surge in petroleum and mining investment as violence from its long guerrilla war subsides and foreign companies drill and mine in areas once dismissed as insecure.
 Leftist FARC guerrillas still attack the country's oil infrastructure and pipelines in remote areas where the state is weak, but bombings and kidnappings are rarer. [ID:nN07127020]
 For FACTBOX on Colombia economy, click on [ID:nN16221666]
 For FACTBOX on Colombia risks, see  [ID:nRISKCO]
 Ecopetrol, which has shares on the New York and Bogota stock exchanges, plans to spend around $3.8 billion this year in increasing production, especially in the Meta area where partners such as Pacific Rubiales are pumping heavy crude.
 Gutierrez said most of the company's shipments -- around 60 percent -- were still focused on the U.S. Gulf coast but Ecopetrol would increasingly look to the Asian market.
 Latin American and Caribbean oil makes up about a third of the crude imported by the United States. Around 20 percent of Ecopetrol exports now go to Asia, mainly China and India.
 "If we keep up the rates we are seeing, we will probably be moving in the order of 25 to 30 percent to Asia ... in the next five years," he said.
 The company recently tendered a cargo of 500,000 barrels of its Castilla oil against Brent crude instead of its usual West Texas Intermediate or WTI as part of diversification.
 Gutierrez said Ecopetrol may tender more crude against Brent in the future, depending on market conditions but that did not represent a change in the company's policy.
 "It is more a question of opportunities," he said.
 While production is increasing in Colombia, experts say its lack of petroleum infrastructure threatens to cause a bottleneck as output overstretches a transportation network still lagging.
 Gutierrez said the first phase of the planned Bicentenario pipeline to link eastern Casanare province with coastal ports will be finished by the end of the year.
 The final phase of the line, with capacity of 450,000 barrels per day, will be completed by 2013-2014.
 "By 2013 we plan to have a capacity to transport from that area around 1.45 million barrels daily," Gutierrez said.
 The project to upgrade and expand the country's oil refinery in Cartagena is 22 percent completed and should be finished and in operation by 2013 to bring refining capacity there to 165,000 bpd.
 Gutierrez said the Barrancabermeja refinery conversion project, to allow the plant to process heavy crude, is in the final stages of approval with investment seen at around $3.4 billion. By 2015, the plant should have a refining capacity of 250,000 bpd.
 "We are going to have a (total) refining capacity of around 415,000 barrels," he said.  (Editing by Jack Kimball and Dale Hudson)   

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