Page 10 - LatAmOil Week 09 2021

LatAmOil COLOMBIA LatAmOil

However, he also indicated that he stood behind ISA is not a good investment, he commented.
the decision to take control of ISA, saying it
would help the NOC reduce its carbon emis- Protection from risk
sions and meet environmental, social and gov- Bayon was speaking shortly before Armando
ernance (ESG) goals. Zamora, the head of Colombia’s national oil reg-
“The fact that no other oil and gas company ulator ANH, expressed support for the compa-
has done it doesn’t mean it’s a bad idea,” he ny’s plans. Speaking at IHS Markit’s CERAWeek
remarked. conference, Zamora said that the acquisition of
Acquiring the TSO will allow Ecopetrol to ISA might help shield Ecopetrol from fluctua-
forge a new path forward as oil and gas fall out tions on world crude markets. “It makes a lot of
of favour, he added. “All the oil and gas compa- sense to engage in a transition by balancing a
nies are going into renewables, and everyone business which is related to energy but provides
is moving into power generation. That doesn’t more stability in the income,” he said.
mean that that’s the only route to energy tran- The ANH chief also acknowledged that the
sition,” he said. Colombian government hoped to put the pro-
Additionally, the CEO also denied specu- ceeds of the transaction to good use. “It has to do
lation that Ecopetrol is under pressure from also with the government balancing the books,
Bogota to complete the transaction in order to given the very difficult fiscal conditions [in
secure extra revenues. “If somebody tells me, which] we are living,” he was quoted as saying
‘You are doing this because the government is by Reuters.
asking me to do it,’ the answer is no,” he declared. ISA and Ecopetrol are currently engaged
“I’m doing this because I’m convinced this is a in non-binding negotiations on the proposed
good business.” sale. Government officials hope the parties will
He went on to say that Ecopetrol was ready to be able to conclude a deal before the end of this
walk away from negotiations for a majority stake year. Bogotá is looking to execute the transac-
in ISA if necessary. The NOC decided to make a tion as a direct contract, rather than calling a
bid after studying the TSO for about a year and a public tender for the stake, since Ecopetrol and
half, but it will drop the plan if it concludes that ISA are both controlled by the state. ™

GUYANA
Financial analyst: Pipeline for Guyana’s

GTP project may cost more than $1bn

JOEL Bhagwandin, a financial analyst for JB Guyanese officials have said that the GTP
Consultancy & Associates, said earlier this week project will entail the construction of a 160-km
that Guyana’s government might have to spend pipeline from Liza, an offshore oilfield within
more than $1bn on the construction of a pipe- the Stabroek block, and a 300-MW thermal
line that will allow the country to use associated power plant (TPP). They have also said that the
gas for electricity generation. exact cost of these endeavours will depend on
Speaking during a webinar hosted by Oil- factors such as the size of the pipeline and the
NOW TV, Bhagwandin noted that Guyana’s extent of the geotechnical surveys needed. ™
Vice-President Bharrat Jagdeo had estimated
the price of the pipeline at around $500-800mn.
He also pointed out, though, that Jagdeo had
said that the true cost of the project would not
become clear until the contract was offered up
in a public tender.
As such, he said, Jagdeo’s estimate may prove
to be too low. He said he believed the price tag
for the project might go as high as $1.1bn.
Additionally, he stressed that the gas-to-
power (GTP) initiative would involve other
costs beyond those of the pipeline construction
contract. Guyana will also have to upgrade its
transmission and distribution infrastructure to
make the most of its investments in gas-fired
power generation, he said. A 160-km pipeline will pump gas from Liza-1 to the coast (Image: OilNOW.gy)

P10 www. NEWSBASE .com Week 09 04•March•2021