Oil & Gas Opportunities

An Expert's View about Building Products and Construction in Colombia

Last updated: 22 Mar 2011

The Colombian Oil & Gas sector is currently experiencing a period of exciting growth and significant developments.

Sector briefing Oil & Gas Opportunities in Colombia Why Colombia? The Colombian Oil & Gas sector is currently experiencing a period of exciting growth and significant developments. The oil investment will reach USD$50bn over the next 5 years and it is estimated that by 2012, Colombia's oil production will reach one million bopd, having doubled since 2007. This makes Colombia the fourth largest oil producer in Latin America after Mexico, Venezuela and Brazil. Over 78 new blocks have recently been auctioned, representing a further deepening of the potential market. Oil proven reserves are estimated to be just short of 2000 million barrels of oil. ?At present Colombia has 240 active oil related The gas sector is less widely developed than oil, but shows significant room for growth. contracts; 120 operating Production has grown over 10% a year in the companies; and an average last five years. Total reserves are estimated to production of 777 million be 7.3 tera cubic feet. bopd. The Government has Find general information on the Colombian announced that oil market conditions on UKTI?s website. The investments will reach Doing Business Guide for Colombia gives an USD$50 bn in the next five overview of Colombia?s economy, business culture, potential opportunities and an years.? introduction to other relevant issue. UK Trade & Investment Sector briefing: Oil & Gas opportunities in Colombia Ecopetrol, the state-owned operating company, Opportunities is seen by suppliers as a reliable partner. This company is investing heavily in both upstream The Colombian market is suitable for a range of and downstream projects worth USD$ 8.5bn operators, with projects ranging from very for this year. large (e.g. the expansion of the Cartagena refinery) through to small technical support for Bicentenario Pipeline operators. The Bicentenario Pipeline will be the largest of In Colombia, the opportunities are focused its kind in Colombia. The private-use oil mainly on: pipeline will connect Casanare and Coveñas, it will be 960 kilometres long and with a capacity Services for the Oil & Gas Industry of 450,000 bopd. There are at least 120 companies between foreign and local companies operating fields in In this project the main partners are seven Colombia ? these range from the big global petroleum companies: Ecopetrol (55%); Pacific payers down to small, single-block operaters. Rubiales (32.88%); Petrominerales (9.65%); Companies are interested in the following Hocol (0.96%); Rancho Hermoso (0.5%); services: Grupo C&C Energía Barbados (0.5%); and Vetra Exploration (0.5%). ? Operation of oil fields ? Maintenance of production and pumping The Sociedad Oleoducto Bicentenario de fields Colombia S.A.S. will be in charge of developing ? Construction of oil storage tanks the pipeline construction in four phases: ? Pipeline maintenance and construction (high and low pressure) The first phase, which will join the Araguaney ? Rental of equipment and drilling tools station in Casanare with Banadia in Arauca, will ? Drilling services and equipment entail an investment of just over US$1billion. (including directional drilling), and drilling fluids The other three phases have not been defined ? Environmental management services yet. Once the technical and financial studies for ? Maintenance of electrical equipment, w those phases are concluded, the company will iring and testing of wells have to approve the construction. The total ? Seismic activity services (both two or three dimensional) pipeline investment is estimated to be US$4.2 ? Improved analytical seismic computer billion and all phases are expected to be codes finalized by December 2012. ? Wellhead equipment (such as valves, compressors, pumps, piping equipment, Barrancabermeja Refinery Expansion Plan safety equipment, well completion, Owned by Ecopetrol, Barrancabermeja is the casing, and cementing equipment) country?s largest refinery and is located in ? Enhanced oil recovery for selected fields Santander Department, with a capacity of in which production is dwindling. 250,000 b/c. Ecopetrol?s pojects In November 2008, US engineering group Off-shore development is currently limited to Foster Wheeler, was awarded a front-end- one block, but around a dozen others are engineering, design and project management currently undergoing some initial form of consultancy contract by Ecopetrol for the assessment. Ecopetrol is planning to drill its upgrade of the refinery. The project is first exploratory well in one of these blocks this designed to boost refining capacity at the year. facility to 300,000 bpd; to add heavy crude processing capability; and to provide a The company has 42 exploratory wells, 28 of processing configuration to meet the projected them are located in Colombia and 10 have 2013 Colombian clean fuels product been awarded in the recent Colombia Open specifications. Total investment will reach Round for investment in the hydrocarbon US$3.4 bn. sector. UK Trade & Investment Sector briefing: Oil & Gas opportunities in Colombia The Cartagena?s Refinery (REFICAR) Expansion Plan The Cartagena refinery is the second largest in the country and is operated by Ecopetrol S.A. They are investing approximately US$3.7bn to expand the refinery?s capacity from 80,000 to 165,000 barrels a day. It would also invest to improve the quality of the fuels to meet national and international environmental specifications, and to optimise the financial and operational indicators. Currently, the Refinery has a capacity of 80 kbpd and is able to process local crude with an average API of 27 degrees. The Refinery has the following plants: Crude Units; Visbreaking Units; Fluid Catalytic Cracker; Light Products; Polymerisation Plants; Amine Plants; Sulphur Plants and Impurities Treatment Plants. It is also self-sufficient in the production of services that the Refinery requires for the processing units, such as water, steam, electricity, air and gas fuel. In addition, the Refinery has two mooring piers from which mainly Diesel and Fuel Oil are exported. Surplus gasoline is shipped to Pozos Colorados (Santa Marta) for coastal navigation, and from there it is sent inland via the Santa Marta ? Barrancabermeja pipeline. In recent years, the portfolio of export products from the Refinery has expanded along with its target markets. This portfolio has included products such as: butane; naphtha; low sulphur jet fuel and fuel oil. These in turn, have been sent to markets such as New York; the Gulf Coast of the United States; Central America and the Mediterranean. There are potential opportunities for British companies in engineering, construction, procurement services, machinery and specialised equipment. If you have any questions on the opportunities above, contact the UKTI contacts named in this report. Business opportunities aimed specifically at UK companies are added daily to UKTI?s website. These leads are sourced by our staff overseas in British Embassies, High Commissions and Consulates, across all sectors and in over 100 markets. You can be alerted to business opportunities on a regular basis by registering on the UKTI website. Find out more on UKTI?s business opportunities service on the UKTI website. UK Trade & Investment Sector briefing: Oil & Gas opportunities in Colombia Major events and activities UKTI contacts Colombia Oil and Gas Edward Dallas Summit and Exhibition Head of Trade & Investment www.cwccolombia.com British Embassy Bogotá Contact: British Embassy Bogotá Tel: (57) 1 326 8262 Email: lucia.rojas@fco.gov.uk Email: edward.dallas@fco.gov.uk Time: 5-7 April 2011 www.uktradeinvest.gov.uk Colombia Petroleum Show Lucia Rojas www.colombiapetroleumshow.com Trade & Investment Assistant Contact: British Embassy Bogotá British Embassy Bogotá Email: lucia.rojas@fco.gov.uk Tel: (57) 1 326 8273 Time: 11-14 October 2011 Email: lucia.rojas@fco.gov.uk www.uktradeinvest.gov.uk Find full details of all events in the Colombian Oil & Gas sector on the UKTI website. New export events are added daily to the site and you can register to be alerted to them on a daily, weekly or monthly basis UKTI?s Tradeshow Access Programme (TAP) provides grant support for eligible Small & Medium Sized Enterprises (SME's) to attend trade shows overseas. Find out more about UKTI support for attendance at overseas events UK Trade & Investment Sector briefing: Oil & Gas opportunities in Colombia Next steps - How UKTI can help ? Arranging appointments British companies wishing to develop their ? Organise seminars or other events for business in the Colombian market are advised you to meet contacts and promote your to undertake as much market research and company in the Chinese market planning as possible in the UK. UKTI?s team in Colombia, with its wide local knowledge and This work is available via our Overseas Market experience, can provide a range of services to Introduction Service (OMIS) a chargeable British-based companies wishing to grow their service which assists British-based companies business in global markets. wishing to enter or expand their business in overseas markets. This can include: ? Provision of market information To find out more about commissioning this ? Validated lists of agents/distributors work, or accessing other UKTI services and ? Key market players or potential specialist advice, please visit the UKTI website customers in the Chinese market to find contact details for your local UKTI ? Establishment of interest of such office. contacts in working with you. Whereas every effort has been made to ensure that the information given in this document is accurate, neither UK Trade & Investment nor its parent Departments (the Department for Business, Innovation & Skills, and the Foreign & Commonwealth Office), accept liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Published 2011 by UK Trade & Investment. Crown Copyright © You may reuse this information (not including logos, images and case studies) free of charge in any format or medium, under the terms of the Open Government Licence. To view this licence, visit www.nationalarchives.gov.uk/doc/open-government-licence/ or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: psi@nationalarchives.gsi.gov.uk This publication is also available from our website at www.ukti.gov.uk or for more information please telephone +44 (0)20 7215 8000. UK Trade & Investment Sector briefing: Oil & Gas opportunities in Colombia
Posted: 22 March 2011, last updated 22 March 2011

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