Bayón Says Unconventionals Not The Only Option

(Energy Analytics Institute, 22.Sep.2020) — Ecopetrol’ CEO Felipe Bayón said unconventionals were a very important option for Colombia but in terms energy security “they’re not the only option.”

Bayón said unconventionals could allow the South American country to boost its crude oil and natural gas reserves-to-production ratios or reserve life while generating benefits for many regions such as employment, and goods and services.

“The company will continue conventional exploration and drilling, near field activities, reprocessing seismic and continuing to explore ways to have more gas and not just onshore but offshore,” Bayón said 22 September 2020 in an interview with ACIPET during its “Tertulias” series.

Hydrocarbons have allowed Colombia to achieve auto-sufficiency and given the country the potential to export oil, he said. Around 40% of Colombia’s exports come from the oil sector; thus, generating important foreign exchange, he added.

An estimated 30 exploration wells are planned in Colombia over the next three years as part of Ecopetrol’s near field focus.

“We have to take our time to plan to drill the best petroleum wells drilled in the history of the country,” Bayón told the virtual audience.

“The most expensive energy is the energy we don’t have [and] if we have to import gas, petroleum gasoline or diesel, we will be at the mercy of international prices and in a much more complex situation for the economy from a structural point of view,” Bayón reiterated.

OXY JV

Ecopetrol’s joint venture with Occidental Petroleum (Oxy) continues to move forward. A price of $35/bbl is needed to operate in the Permian longer-term and economically, Bayón said.

In seven months, the partners have boosted oil production by 17,900-18,000 barrels per day (b/d) with the drilling of 22 wells. Currently, the companies are utilizing two rigs. Another 22 wells are planned by the start of next year, Bayón said.

The Permian is of 40-degree API. “If our Permian field was ranked among Ecopetrol’s fields in terms of output, it would rank in the top 10,” Bayón said.

“Ecopetrol has a heavy oil portfolio in Colombia. The light Permian oil production gives Ecopetrol an opportunity to balance the portfolio and incorporate important reserves. The [Permian] field needs $7-$10/bbl to produce and it is among the three most economic fields within Ecopetrol. So, from a portfolio point of view, it is good,” he concluded.

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By Piero Stewart. © Energy Analytics Institute (EAI). All Rights Reserved.