Page 7 - LatAmOil Week 48 2019
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LatAmOil COLOMBIA LatAmOil
“What the government has o ered protesters
has a scal cost. ese funds from Ecopetrol are
an insurance for what may happen next year. If
the tax bill doesn’t pass or the government can’t
sell state assets, it won’t nd itself against the
wall,”hetoldBloomberg. “Ecopetrolhasthe nancialcapacitytomake
German Cristancho, head analyst for the the payment,” he commented.
Colombian oil auction draws bids for 15 out of 59 blocks
COLOMBIA’S latest oil auction attracted bids for 15 blocks out of the 59 on o er, the country’s national hydrocarbons agency ANH has said.
A total of 10 companies made 17 bids in the ongoing auction, the agency noted in a state- ment. is is less than half the number of rms that pre-quali ed for bidding, and it may indi- cate that investors have signi cantly less interest in Colombia than ANH had anticipated.
e 15 blocks are expected to bring in at least $500mn in investment. According to ANH’s statement, that gure could rise if new coun- tero ers are submitted in the next stage of the auction, which starts on December 5th.
“Today’s exercise shows the con dence of oil investors in the development of the country in a challenging environment of low prices and social turbulence in the region,” argued Luis Miguel Morelli, the president of ANH.
Even so, the sum of $500mn would be dis- appointing. Previously, ANH said it was hoping the auctions would attract $800mn worth of investment.
e agency did not divulge which companies had made bids in this latest round. In the pre- qualifying stage, which nished in November, US major Occidental Petroleum, India’s ONGC
Videsh Ltd (OVL) and China National O shore Oil Corp. (CNOOC) were among the 27 compa- nies authorised to take part.
Of the 59 exploration blocks listed, 35 are crude oil blocks and the rest are natural gas. They are located in the northern Cesar and Magdalena Medio valley areas and in the east- ern Llanos Basin, as well as o the Atlantic coast.
is is the second oil auction to be held in the Latin American nation this year, following one in June in which six companies were awarded a total of 11 contracts. Frontera Energy, Geopark and Ecopetrol were among the winners in that auction, which ANH had also said would attract around $500mn in investment.
Morelli said that the two rounds of auctions had given Colombia a 37% auction success rate. This is “above the international average of 30% for assignment of areas by auction,” he commented.
The Colombian government is trying to boost a stagnant oil sector, with modi ed con- tractual terms and less bureaucracy, following a slump in exploration in recent years owing to the oil price crash. So far this year, foreign majors ExxonMobil, Repsol and Royal Dutch Shell have all signed deals for new blocks in Colombia.
Corredores Davivienda brokerage, agreed that the payment would help the company. He pointed out that the NOC’s cash ows and nan- cial performance were strong enough to support the special dividend programme.
Colombia included 59 sites in its most recent licensing round (Image: ANH)
Week 48 05•December•2019 w w w . N E W S B A S E . c o m P7
