Ecopetrol is investing $ 1.5 billion in fracking in the United States

The alliance with Oksio would allow the Colombian company to gradually increase its production over the next 10 years to about 95,000 barrels per day by 2027.

A strategic alliance has sealed Ecopetrol in the United States with the western oil company to develop fracking in the Permian basin, considered to be the largest production in the world, of which more than 4 million barrels of oil are extracted daily.

The alliance, in which the Colombian oil company invests $ 1.5 billion, would enable the Colombian company to gradually increase its production by up to 95,000 barrels per day by 2027. (Context: Ecopetrol is contemplating a $ 500 million investment in fracking).

It will also improve the country's current reserves profile by about 160 million barrels of oil equivalent (mbpe) at the end of the transaction, scheduled for later this year, which would represent an approximate 10% increase compared to reserves. . from 2018, contributing to Ecopetrol's oil and financial sustainability.

The agreement with OXY includes transfer of technology and knowledge in the development of the Non-Conventional Sites (YNC).

The company says in a statement that participation in the new company will contribute to the diversification of the portfolio Ecopetrol thanks to the incorporation of assets considered short cycles, characterized by lower research risk and very short durations between the commencement of activities and the acquisition of production. (Read: Oil multinational companies ready for fracking license application in Colombia).

It also makes it possible to increase the share of light crude (close to 40 API degrees – a measure of oil density – on average) to balance the product matrix of the Ecopetrol group, today focused on heavy crude.

A spokesman for the Colombian state-owned company was pleased with the deal reached with one of the largest development companies in the world Unconventional Deposits (YNC). The announced agreement marks a milestone in the relationship of more than 40 years between the two companies.

Under the agreement, OXY will own 51% of the new company, contribute its experience as an operator and about 97,000 acres in the Permian Middle, an area with high hydrocarbon potential. For its part, Ecopetrol will have about 49% in the company delivering an initial payment of 50% at the end of the transaction and 50% in deferred investment over time in activities planned in the development plan.

Ecopetrol's total payment is $ 1.5 billion, in a competitive transaction compared to comparable operations performed on the market in recent years. It is one of the largest transactions Ecopetrol has made to date.

Considered the impossibility of developing Unconventional Deposits In the country, Ecopetrol is seeking fields of action to increase reserves anywhere in the world. The Company created Ecopetrol Permian LLC. In turn, it formed Ecopetrol USA Inc., which will be responsible for the consolidation of Ecopetrol Permian LLC, the new YNC-focused company, and the subsidiary Ecopetrol America LLC, which will continue to manage Gulf of Mexico-US operations, where Ecopetrol is already producing more. more than 15,000 bpi.