Page 4 - LatAmOil Week 11 2021

LatAmOil COMMENTARY LatAmOil

Example of contamination from sulphide-ore copper mining (Photo: NASA)

Colombia may be exchanging

one type of risk for another

Ecopetrol’s bid for ISA and Mesa’s talk of focusing on copper mining may

be part of a wider effort to take the spotlight off the oil and gas sector

COLOMBIA’S national oil company (NOC) the transaction through in order to generate
Ecopetrol has drawn attention recently because extra revenues to cover its own expenses.
WHAT: of its decision to seek a 51.4% stake in Intercon- There are signs, though, that Colombian
Mines and Energy Min- exion Electrica SA (ISA), the country’s electric- authorities view the sale as a good thing – and
ister Diego Mesa wants ity transmission system operator (TSO). as part of a wider effort to heed rising climate
to see Colombia invest in This may be inevitable, partly because both concerns.
copper mining. companies play a pivotal role in the country’s
economy and partly because of the scale of the Bayon and the bid for ISA
WHY: deal, which is anticipated to carry a price tag of Environmental considerations were certainly
His suggestion, which $3.5-4.0bn. evident in statements that Ecopetrol CEO Felipe
follows Ecopetrol’s an- But not all of the attention has been positive. Bayon made late last month.
nouncement of a bid for Indeed, a number of observers have expressed a In an interview with Bloomberg, Bayon
ISA, is in line with a shift
to electricity in South certain amount of scepticism about this move, insisted that the TSO would be a worthwhile
America. describing it as a major departure from Ecopet- investment even though it was focused on activ-
rol’s core business – that is, from the develop- ities that fell outside Ecopetrol’s current scope
WHAT NEXT: ment, transport, processing and sale of crude oil – namely, electricity transmission, the opera-
Since copper mining and natural gas. tion of toll roads and fibre optics. If the NOC
carries its own risks, Others have speculated that the NOC is can build momentum on these fronts, it will be
Colombia will still face being forced into the deal by the Colombian “years ahead” with respect to diversifying its
environmental hazards. government, suggesting that Bogota is pushing portfolio, he declared.

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