Colombia's private oil companies say ready to invest $715 mln in recovery

Credit: REUTERS/Jaime Saldarriaga

BOGOTA, Aug 25 (Reuters) - Private oil and gas companies in Colombia stand ready to invest some $715 million during the rest of 2020 to help kick-start the energy sector, the producers association said.

The Andean country's government will lift a five-month-long quarantine at the end of August.

The lockdown, imposed in late March, was meant to halt the spread of novel coronavirus, although many sectors have already returned to work under strict safety measures.

"Private companies in Colombia are ready to invest close to $715 million in 2020 as part of resources that will be fundamental for the reactivation process," Francisco Lloreda, president of the Colombian Petroleum Association (ACP), said in a statement late on Monday.

"We know the potential the country has in oil and gas, in onshore, offshore, and non-conventional deposits among others, which could be a source of income and economic strength both regionally and nationally," he said.

To ensure economic resources are available, measures must be taken which include addressing pipeline costs for transporting gas at competitive prices, while technical and environmental regulations for offshore projects slated to start in 2021 must be completed, Lloreda said.

Other important areas include progressing on pilot projects for non-conventional deposits, addressing oil pipeline costs, and assuring environmental licenses are effective and efficient, among others, he added.

At the start of 2020, the ACP said investment in Colombia's oil and gas industry would rise 23% to $4.97 billion.

However in April, the group said planned investments by private oil companies would fall by $1 billion due to the fall in oil prices.

The government has cut its oil production outlook for the year to a range of between 820,000 and 850,000 barrels a day. In 2019, the country produced an average of 885,851 barrels a day.

(Reporting by Luis Jaime Acosta Writing by Oliver Griffin Editing by Bernadette Baum)

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