Ecopetrol plans international expansion

Colombia's state oil company Ecopetrol plans to become a multinational company through international expansion, mines and energy minister Luis Ernesto Mejia said on Thursday during the 2003 Energy Conference, government news agency CNE reported. "It's a strategy we are developing to increase the country's reserves," Ecopetrol manager Esteban Calle told BNamericas. "We already have proposals from other countries for Ecopetrol to start operations such as exploration, production and transport. We are analyzing them at this time and we will announce them publicly when they materialize," Mejia said, CNE reported. Mejia cited the international expansion of Brazil's state oil company Petrobras as an example for Ecopetrol to follow. The government's reorganization of Ecopetrol in June that split the company into three parts, leaving Ecopetrol as the operating unit, has facilitated international growth, Calle said. "Now that Ecopetrol has the profile of a company focused on oil production, it is the right time to think about expanding its operations and behaving like any other oil company," he said. "The first step is to assimilate the company's new structure, and then focus on international opportunities," Calle said, adding that Ecopetrol will be in a position to sign contracts by early 2004. Although the company has no definite plans yet, it is studying possible joint ventures in Colombia and elsewhere in Latin America with Petrobras and Sipetrol, the international arm of Chile's state oil company Enap, Calle said. "That doesn't mean we will just do projects with these two companies, but that's how we're starting to look at opportunities in other countries," he said. Ecopetrol does not have the expertise to enter into international oil projects on its own, and it is normal industry practice to share oil exploration risk, Calle said. Colombia's current reserves are estimated at about 2.8 billion barrels of crude, down from 2.9 billion a few years ago, Calle said. The country is currently producing about 546,000 barrels a day (b/d), down from 815,000b/d just four years ago, CNE reported. Government officials have warned that Colombia could become a net oil importer within five years if new reserves are not discovered. "We are producing more than we are discovering and that's why reserves are falling," he said, adding that various factors, including lack of foreign investment, are behind the lower reserves and production.