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Ecopetrol hopes to begin fracking pilot projects by end-2021

Credit: REUTERS/LUISA GONZALEZ

Colombian majority state-owned oil company Ecopetrol hopes to begin operations on pilot projects for non-conventional energy deposits by the end of next year, Chief Executive Felipe Bayon said on Wednesday, stressing that uncertainty remains.

BOGOTA, Oct 28 (Reuters) - Colombian majority state-owned oil company Ecopetrol ECO.CN hopes to begin operations on pilot projects for non-conventional energy deposits by the end of next year, Chief Executive Felipe Bayon said on Wednesday, stressing that uncertainty remains.

Commercial production from non-conventional energy sources - including fracking for shale gas - is currently not permitted in Colombia. However, preparations are being made to conduct a number of pilot projects in the Andean country.

"We are waiting to have the license and to be able to start activities, and we hope this will start before the end of next year," Bayon told investors in a call about the company's third quarter results, which were released on Tuesday.

"Later it will depend first on terms for drilling and completing the fracture of the wells, which still holds some level of uncertainty," he added.

In September last year, Bayon told Reuters fracking pilot projects in Colombia could begin in the second half of 2020.

Exploration of non-conventional energy sources such as fracking and coal bed methane is deeply controversial in Colombia. While supporters say the methods will guarantee energy security, detractors warn it could damage human health and the environment.

Colombia's Council of State - the country's top administrative court - ordered the temporary suspension of non-conventional exploration in 2018. It upheld the moratorium last year, but later said the suspension did not block pilot projects.

A decision on developing non-conventional deposits was expected to be made in the first half of this year, but the process has been delayed due to the coronavirus pandemic.

Ecopetrol reported a third-quarter net profit of 855 billion pesos ($224.2 million), a decline of 72% compared with 3.01 trillion pesos a year ago.

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

((Oliver.Griffin@thomsonreuters.com; +57 304-583-8931;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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