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Colombia oil output below 700,000 b/d
after two weeks of nationwide protests

CBSN

Widespread disturbances have caused aggregated production losses so far of 560,000 barrels of crude.

- Weekend negotiations bring no solution to nationwide protests
- Ecopetrol unhurt, but three smaller oil companies report output cuts

By Chris Kraul/Platts

BOGOTA
Petroleumworld 05 20 2021

Colombia's daily crude oil production has fallen below an average 700,000 b/d for the first time since 2009, the energy minister said May 19, saying two weeks of nationwide protests and road blockades have significantly cut into the Andean country's ability to produce and transport petroleum, refined products, and other minerals.

The crude output reduction represents a minimum 6% decline from the 744,715 b/d of crude pumped nationwide in March, the most recent month for which figures are available from the energy ministry. Already reeling from the impact of coronavirus shutdowns, Colombia's oil patch was pumping 857,112 b/d of crude as recently as March 2020.

Energy minister Diego Mesa told a business group in Bogotá that widespread disturbances have caused aggregated production losses so far of 560,000 barrels of crude. In addition, more than 45% of Colombia's service stations have been affected by demonstrations and blockades, with the affected stations reporting an average 50% drop of sales at the pump.

Several oil companies active in Colombia said this week that the blockades have adversely affected their operations. Although oil giant Ecopetrol, producer of two-thirds of the country's oil and equivalents, said that so far it has suffered no material impact, three smaller companies said their production levels have sharply fallen since the protests began late last month.

Geopark said that its production "curtailments" amount to 12,000-15,000 fewer barrels of crude and equivalents per day, or 40-45% below the company's prior production in Colombia which, over the first quarter, averaged 31,455 boe/d. Gran Tierra said this week that it currently is losing 5,250 b/d of its normal crude output, or 18% of the 29,600 b/d it was pumping prior to the protests.

Parex Resources said in a statement issued May 17 that its daily output has fallen to 31,000 boe/d, down 24.6% from about 41,100 boe/d that it averaged between April 1 and May 16, 2021. The company also said it was lowering its output target for the current quarter.

Protests began late last month after President Ivan Duque introduced a tax reform proposal that critics saw as harmful to low- and middle-class economic strata. Although Duque soon withdrew the proposal, protests grew as a broad range of disaffected interest groups, including environmentalists, farmers, and medical care advocates joined the marches.

Truckers, outraged by the rising costs of toll roads, have blocked most major highways, including those leading into Bogotá, the capital, and other large cities including Cali and Medellín. That has caused shortages of medicines, food, propane, and gasoline, Mesa said.

More than 50 have died in often confrontations with police, and scores of businesses have been damaged or shut. The government has blamed radical groups and vandals for the violence while some US congress members and human rights advocates complained of overly harsh police response to the marchers.

Duque's representatives and leaders of the National Strike Committee held talks on Sunday and Monday in a bid to resolve the protests but came to no agreement. Afterward, Duque announced that he would soon call on police and local officials to join in clearing the highway blockades, which raised fears of further violence.

In his May 19 talk, energy minister Mesa said that the energy and mining sectors have lost about $70 million in revenue so far. The losses stem from the disruption in the oil and gas industry, but also in coal mining, which so far has lost 150,000 mt of exports, he said.

______________

By Chris Kraul, edited by Valarie Jackson from S&P Global Platts

spglobal.com 05 19 2021
TOP
 

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