Oil Cos to Invest $7B in Colombia in 08,Up from $6B '07

Foreign and Colombian oil and gas companies will spend $7 billion this year in exploration and production, 17% more than the $6 billion invested last year, Monday said Armando Zamora, head of the oil licensing agency, known as ANH.

Local and international oil companies are expected to drill between 85 and 90 exploration wells this year, up from the 70 they drilled last year, Zamora added.

In 2007, international oil companies invested $3.5 billion in exploration, production and in refineries, while the rest came in from state-owned oil company Ecopetrol (ECOPETROL.BO), Zamora added.

Ecopetrol plans to invest $3.8 billion in production and exploration activities in 2008 to boost oil output and reserves, Chief Executive Javier Gutierrez said Monday.

The investment is higher than the $3.7 billion the company announced late last year, Gutierrez added.

The investment figures also include Ecopetrol's efforts abroad. The company is currently seeking oil in partnership with other companies in Peru, Brazil and in the Gulf of Mexico.

Meanwhile, mining giant BHP Billiton Ltd. (BHP) is expected to drill an exploration offshore well in the Colombian Caribbean in the second half of 2008, Zamora added.

Javier Gutierrez, chief executive of Ecopetrol, specified that the company most likely will begin the drilling toward the end of the year or may be beginning in 2009.

In April 2006, BHP Billiton PLC (BBL) acquired exploration and production rights in the Fuerte Norte and Fuerte Sur, blocks located in Caribbean waters, near the Tayrona block, said Ecopetrol spokesperson.

BHP Billiton holds a 75% interest in each block and is the operator, while Ecopetrol holds the remaining 25%.

Finally, Zamora said ANH will open an exploration licensing round in the Colombian Pacific waters in 2009.

Copyright (c) 2008 Dow Jones & Company, Inc.


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