Ecopetrol will borrow up to $2 billion to finance acquisitions

Ecopetrol, Colombia's largest state-owned oil company, plans to borrow up to $2 billion this year in order to fund investment. It will also consider raising funds through banks and the capital markets.

The debt will be used for inorganic investments such as new projects or assets.

Camilo Barco, Corporate Vice President of Finance at Ecopetrol, said that in a conference call with investors the board of Ecopetrol had authorized $1 billion for structural debt. A further $1 billion was also approved as a temporary measure.

Barco stated that he is confident the inorganic plan will accelerate in the second half of this year and that "some funding operations" will be required to implement it.

Chief Executive Ricardo Roa stated that Enel’s Windpeshi project in northern La Guajira was a target and both companies were working on a deal.

Ecopetrol's investment plan this year is between $5.9 and $6.8 billion, financed mainly from its own cash reserve, which was $4.4 billion at the end of 2024.

Rafael Guzman said that the company expects to produce between 740,000 and 755,000 barrels of oil-equivalent per day (boepd), in 2025.

Last year, the company's average production reached 745,800 Boepd, its highest level in 9 years.

Guzman explained that the forecast includes production from the recent acquisition by Repsol of a 45% share in the CPO 09 field, as well as environmental risks associated with the field.

Ecopetrol reported earlier that its 2024 net profit would drop by nearly 22 percent due to a weaker U.S. Dollar and lower oil prices. Reporting by Nelson Bocanegra; Writing by Julia Symmes Cobb, Editing by Bill Berkrot

(source: Reuters)