Colombia's Cano Limon Oil Pipeline Resumes Pumping

BOGOTA May 23, 2006 (Dow Jones Commodities News via Comtex)

Colombia's No. 2 crude export pipeline, Cano Limon, resumed pumping Monday after a week-long interruption caused by rebel attacks, a company official said.

The pipeline resumed operations after repair crews worked on it for a week after it was bombed three times last Monday and Tuesday, said an official from U.S. oil company Occidental Petroleum Inc. (OXY), who declined to be identified.

The bombers belonged to the FARC left-wing rebel group, according to the Colombian army.

The broken pipeline spilled between 6,000 and 8,000 barrels, polluting a river that flows toward the Maracaibo gulf in Venezuela, Luis Miguel Morelli, the governor of Norte de Santander province said last week.

The Cano Limon pipeline is jointly owned by state oil firm Ecopetrol (ECO.YY) and Occidental Petroleum (OXY). The 780-kilometer pipeline serves Occidental's Cano Limon field, the No. 2 field in Colombia. The pipe carries about 100,000 barrels a day to the Atlantic port of Covenas for export.

Copyright (c) 2006 Dow Jones & Company, Inc. Los Angeles-based Occidental is the second-biggest oil producer in Colombia, extracting about 95,000 b/d, according to the company. Rebel groups killed a worker from Occidental and kidnapped another one for a few days in January.

Oil production didn't stop at Cano Limon field as Occidental has the capacity to stock part of its production in big tanks in the field. The pipeline has a capacity of 200,000 b/d so the company will be able to ship its stocks of crude quickly to the coast for export.

Colombia, Latin America's fifth-largest oil exporter, produced 519,350 b/d in 2005, according to the director of the National Association of Hydrocarbons, Armando Zamora. The country's reserves, however, are dwindling, and Colombia may become a net importer in 2011 if no significant oil discovery is made.


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