Watching The World: Colombia still fighting FARC

Sept. 5, 2011
Colombia's government has made considerable strides in recent years to improve the security conditions for oil and gas companies operating in the country.

Eric Watkins
Oil Diplomacy Editor

Colombia's government has made considerable strides in recent years to improve the security conditions for oil and gas companies operating in the country. But more effort is needed, if Colombia's growing reserves are to be turned into revenues.

"Insurgent attacks against oil infrastructure have increased in isolated rural areas this year, in an attempt by guerrilla groups to undermine the government's efforts to strengthen the oil sector," said Diego Moya Ocampos of IHS Global Insight.

Colombia's President Juan Manuel Santos is well aware of the problem, last week announcing plans to improve security for international oil companies (IOCs) in Caqueta state after an oil worker was killed by a roadside bomb.

Santos said the new plan seeks to "protect the investors, that is, the oil companies, and at the same time maintain the offensive capabilities of our armed forces."

Redesigned security apparatus

Echoing the president, Defense Minister Rivera spoke of a "redesign" of the country's security apparatus for energy firms, especially given the increased—and increasing—number of companies at work.

"What was rational a few years ago because there were so few oil companies…now doesn't make sense when you have 130 oil companies with exploration agreements, all of which have security requirements," Rivera said.

Government efforts over the past 4 years have contributed to an improved operating environment for the oil companies. One sign is the fact that Colombia's oil production reached 929,000 b/d in July—nearly double the 531,000 b/d in 2007.

Colombia's production is expected to rise to 1 million b/d by yearend, largely due to the increased confidence of IOCs that plan to spend an estimated $4 billion on oil exploration and development in the course of the year.

The notorious FARC

The notorious Fuerzas Armadas Revolucionarias de Colombia (FARC) rebels, who have historically caused the most disruption in the country, are down to about 8,000 members from the 16,000 of 10 years ago.

But FARC is hardly a spent force, and even 8,000 armed fighters can cause a whole lot of damage, especially when they can operate with near-impunity in the remote regions where IOCs explore for oil and gas.

Consider some of the most recent incidents such as the death of a worker for Geoenergy who was killed on Aug. 3 when the sports utility vehicle in which he was riding struck a land mine. Three of his coworkers, as well as their driver, were injured.

In July, five contract workers for Occidental Petroleum Corp. were kidnapped and released a few days later. But five Chinese nationals working as contractors for Emerald Energy weren't so lucky. They were kidnapped in June and have not been heard from since.

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