Ecopetrol unveils US$12-15bn business plan

Colombian state-run energy firm Ecopetrol will invest up to US$12-15bn over the next three years as it prioritizes upstream, decarbonization and innovation projects, executives said on Wednesday. 

Exploration and production initiatives will receive US$9-11bn while US$1.3bn has been allocated to gas expansion plans.

Production over the period is expected to rise to around 750,000boe/d (barrels of oil equivalent a day) from 697,000boe/d in 2020. Refinery throughput is on track to reach 340,000-420,00b/d by 2023 compared to 340,000-365,000b/d this year, the Bogotá-based company said.

In 2021, Ecopetrol has forecast a capital outlay of US$3-4bn compared to 11.1tn pesos last year (US$3.1bn at the current exchange rate).

“This is a plan that will allow us to return to growth in production and reserves, protecting our core business,” CEO Felipe Bayón said during a quarterly earnings call. 

He added that the company was capable of financing the business plan with its own resources. 

The new targets came as Ecopetrol reported a 2020 net profit of 1.69tn pesos, down from 13.3tn pesos the previous year, as it grappled with the effects of the coronavirus pandemic. Fourth-quarter net profit fell to 675bn pesos from 4tn pesos in 2019. 

Ecopetrol said it expects to drill nine exploratory wells this year while production is seen rising around 1% to 700,000-710,000boe/d. 


The plan earmarks US$600mn for decarbonization and US$100-150mn for innovation and technology initiatives. 

In 2021, the company plans to award contracts for the development of six solar parks totaling 45MW. Its renewable energy portfolio is expected to rise to 400MW by 2023. 

Ecopetrol has also set aside US$120-130mn for water initiatives, US$100-150mn for its digital strategy and US$70-80mn to improve fuel quality. 


The company said it is conducting due diligence for its planned acquisition of the government’s 51.4% stake in Medellín-based power transmission company Interconexión Eléctrica (ISA). 

Bayón reiterated Ecopetrol’s aim to finance the operation through an equity offering that could reap US$1.5-2.5bn and the sale of up to US$2.5bn of debt. 

An exclusive negotiation period is due to end on June 30 and Ecopetrol aims to complete the operation by the end of the year, pending regulatory approvals. 

“It represents a transformation, turning Ecopetrol into a broader and more efficient company,” Bayón said of the deal. “It will improve our risk profile by providing an additional hedge against volatility and it will give the company a regional presence,” he added.