Ecopetrol plans acquisitions this year to strengthen the reserves

The company plans to have 41 drilling rigs by the end of the year and to keep that number at least next year.

Campo de Chichemene of the Colombian oil company.Ecopetrol

The Colombian company Ecopetrol plans to expand oil and gas reserves through acquisitions while increasing its presence in the US (In context "Fracking" and purchase of reserves, priorities of Ecopetrol in 2018).

The state-owned oil company has identified assets that it would consider acquiring, the president said on Friday. Felipe Bayón during an interview in the New York Stock Exchange. "We are trying to make it happen this year."

"It must fit in with the strategy and the right valuation," said Bayón. "Mexico and Brazil are absolutely two of the most important places we want to be, through exploration or through acquisitions." The company aims to expand its presence in the US and possibly join forces with a partner, he said.

Analysts believe that the level of raw reserves is a problem for the Colombian oil company. Oil is the largest export of Colombia, but the country had reserves that were comparable to slightly more than five years of production at the end of last year. That is more than forty years ago Ecuador and almost four centuries before Venezuelaaccording to the statistical assessment of BP.

Colombia is on track to not meet the target of the 65-well government throughout the year. Ecopetrol operated 33 platforms at the end of the second quarter. The company plans to have 41 drilling rigs by the end of the year and to keep that number at least next year.

Ecopetrol is considering expanding the capacity of the Cartagena refinery from 150,000 barrels per day to 210,000 barrels, Bayón said. A final investment decision could be made early next year when they have completed technical studies. Part of the expansion may come from returning old units to the service, he said.

Oil coverage

Ecopetrol is considering to cover the oil price as an independent company of the Colombian government. Bayón He said they did not exclude coverage, although it is not necessary at the moment. To reach the break-even point, in terms of profit, Ecopetrol only needs oil prices of about US $ 35 per barrel, compared to the US $ 65 per barrel needed four years ago, he said.

"Although we have some sort of independent government in terms of how the company is managed, I am sure that this will create a political debate, in terms of coverage itself."

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